Old Second Bancorp (OSBC) 10-K 7 Mar 19 2018 FY Annual report Financial data

Document and Entity Information

Document and Entity Information - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2018	Mar. 04, 2019	Jun. 29, 2018
Document and Entity Information
Entity Registrant Name	OLD SECOND BANCORP INC
Entity Central Index Key	357,173
Document Type	10-K
Document Period End Date	Dec. 31, 2018
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Public Float			$ 422.4
Entity Common Stock, Shares Outstanding		29,889,985
Document Fiscal Year Focus	2,018
Document Fiscal Period Focus	FY

Consolidated Balance Sheets

Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Assets
Cash and due from banks	$ 38,599	$ 37,444
Interest bearing deposits with financial institutions	16,636	18,389
Cash and cash equivalents	55,235	55,833
Securities available-for-sale, at fair value	541,248	541,439
Federal Home Loan Bank Chicago ("FHLBC") and Federal Reserve Bank Chicago ("FRBC") stock	13,433	10,168
Loans held-for-sale	2,984	4,067
Loans	1,897,027	1,617,622
Less: allowance for loan losses	19,006	17,461
Net loans	1,878,021	1,600,161
Premises and equipment, net	42,439	37,628
Other real estate owned	7,175	8,371
Mortgage servicing rights, net	7,357	6,944
Goodwill and core deposit intangible	21,814	8,922
Bank-owned life insurance (BOLI)	61,544	61,764
Deferred tax assets, net	21,280	25,356
Other assets	23,473	22,776
Total assets	2,676,003	2,383,429
Deposits:
Noninterest bearing demand	618,830	572,404
Interest bearing:
Savings, NOW, and money market	1,040,668	967,750
Time	457,175	382,771
Total deposits	2,116,673	1,922,925
Securities sold under repurchase agreements	46,632	29,918
Other short-term borrowings	149,500	115,000
Junior subordinated debentures	57,686	57,639
Senior notes	44,158	44,058
Notes payable and other borrowings	15,379
Other liabilities	16,894	13,539
Total liabilities	2,446,922	2,183,079
Stockholders' Equity
Common stock	34,720	34,626
Additional paid-in capital	119,081	117,742
Retained earnings	175,463	142,959
Accumulated other comprehensive (loss) income	(4,079)	1,479
Treasury stock	(96,104)	(96,456)
Total stockholders' equity	229,081	200,350
Total liabilities and stockholders' equity	$ 2,676,003	$ 2,383,429

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) - $ / shares	Dec. 31, 2018	Dec. 31, 2017
Consolidated Balance Sheets
Common stock, Par value (in dollars per share)	$ 1	$ 1
Common Stock, Shares authorized	60,000,000	60,000,000
Common stock, Shares issued	34,719,517	34,625,734
Common stock, Shares outstanding	29,763,078	29,627,086
Treasury stock, Shares	4,956,439	4,998,648

Consolidated Statements of Inco

Consolidated Statements of Income - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Interest and Dividend Income
Loans, including fees	$ 88,769	$ 70,737	$ 56,019
Loans held-for-sale	127	123	151
Securities:
Taxable	9,577	10,202	15,865
Tax exempt	8,341	5,939	842
Dividends from FHLBC and FRBC stock	469	370	333
Interest bearing deposits with financial institutions	334	134	169
Total interest and dividend income	107,617	87,505	73,379
Interest Expense
Savings, NOW, and money market deposits	2,156	950	789
Time deposits	5,829	4,227	3,640
Securities sold under repurchase agreements	462	17
Other short-term borrowings	1,429	741	106
Junior subordinated debentures	3,716	4,002	4,334
Senior notes	2,688	2,689	112
Subordinated debt			949
Notes payable and other borrowings	398		8
Total interest expense	16,678	12,626	9,938
Net interest and dividend income	90,939	74,879	63,441
Provision for loan and lease losses	1,228	1,800	750
Net interest and dividend income after provision for loan and lease losses	89,711	73,079	62,691
Noninterest Income
Mortgage servicing rights mark to market loss	(734)	(802)	(919)
Net gain on sales of mortgage loans	3,791	4,803	6,343
Securities gains (losses), net	360	474	(2,213)
Increase in cash surrender value of BOLI	984	1,432	1,283
Death benefit realized on bank-owned life insurance	1,026
Debit card interchange income	4,420	4,200	4,027
Gains (losses) on disposal and transfer of fixed assets, net		10	(1)
Other income	5,126	4,778	4,938
Total noninterest income	31,353	30,372	28,574
Noninterest Expense
Salaries and employee benefits	44,161	40,080	36,234
Occupancy, furniture and equipment	6,915	5,951	6,063
Computer and data processing	6,745	4,387	4,349
FDIC insurance	653	658	865
General bank insurance	1,040	1,031	1,109
Amortization of core deposit intangible	387	96	16
Advertising expense	1,567	1,505	1,633
Debit card interchange expense	940	1,329	1,455
Legal fees	835	650	800
Other real estate expense, net	396	2,165	2,743
Other expense	13,489	11,297	11,494
Total noninterest expense	77,128	69,149	66,761
Income before income taxes	43,936	34,302	24,504
Provision for income taxes	9,924	19,164	8,820
Net income available to common stockholders	$ 34,012	$ 15,138	$ 15,684
Basic earnings per share (in dollars per share)	$ 1.14	$ 0.51	$ 0.53
Diluted earnings per share (in dollars per share)	1.12	0.50	0.53
Dividends declared per share (in dollars per share)	$ 0.04	$ 0.04	$ 0.03
Trust Income
Noninterest Income
Service charges on deposits	$ 6,417	$ 6,203	$ 5,670
Bank Servicing
Noninterest Income
Service charges on deposits	7,328	6,720	6,684
Secondary mortgage fees
Noninterest Income
Service charges on deposits	696	776	1,038
Mortgage Servicing
Noninterest Income
Service charges on deposits	$ 1,939	$ 1,778	$ 1,724

Consolidated Statements of Comp

Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Consolidated Statements of Comprehensive Income
Net income	$ 34,012	$ 15,138	$ 15,684
Unrealized holding (losses) gains on available-for-sale securities arising during the period	(9,053)	17,863	(1,155)
Related tax benefit (expense)	2,554	(7,183)	445
Holding (losses) gains after tax on available-for-sale securities	(6,499)	10,680	(710)
Less: Reclassification adjustment for the net gains (losses) realized during the period
Net realized gains (losses)	360	474	(2,213)
Related tax (expense) benefit	(100)	(198)	882
Net realized gains (losses) after tax	260	276	(1,331)
Other comprehensive (loss) income on available-for-sale securities	(6,759)	10,404	621
Accretion of net unrealized holding gains on held-to-maturity transferred from available-for-sale securities			5,939
Related tax expense			(2,446)
Other comprehensive income on held-to-maturity securities			3,493
Changes in fair value of derivatives used for cashflow hedges	1,230	(293)	(363)
Related tax (expense) benefit	(348)	130	146
Other comprehensive income on cashflow hedges	882	(163)	(217)
Total other comprehensive (loss) income	(5,877)	10,241	3,897
Total comprehensive income	$ 28,135	$ 25,379	$ 19,581

Consolidated Statements of Cash

Consolidated Statements of Cash Flows - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Cash flows from operating activities
Net income	$ 34,012,000	$ 15,138,000	$ 15,684,000
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Net premium amortization/discount (accretion) on securities	2,969,000	1,881,000	(638,000)
Securities (gains) losses, net	(360,000)	(474,000)	2,213,000
Provision for loan and lease losses	1,228,000	1,800,000	750,000
Originations of loans held-for-sale	(133,930,000)	(146,867,000)	(194,901,000)
Proceeds from sales of loans held-for-sale	137,622,000	151,289,000	197,654,000
Net gain on sales of mortgage loans	(3,791,000)	(4,803,000)	(6,343,000)
Change in fair value of mortgage servicing rights	734,000	802,000	919,000
Net discount (accretion)/premium amortization of purchase accounting adjustment on loans	(1,703,000)	(1,328,000)	(604,000)
Increase in cash surrender value of BOLI	(984,000)	(1,432,000)	(1,283,000)
Net gains on sale of other real estate owned	(792,000)	(474,000)	(374,000)
Provision for other real estate owned valuation losses	581,000	1,708,000	1,570,000
Depreciation of fixed assets and amortization of leasehold improvements	2,423,000	2,306,000	2,288,000
Net (gains) / losses on disposal and transfer of fixed assets		(10,000)	1,000
Amortization of core deposit intangible	387,000	96,000	16,000
Change in current income taxes receivable	1,678,000	(2,519,000)	260,000
Provision for deferred tax expense	9,840,000	13,662,000	8,421,000
Net deferred tax expense due to DTA valuation adjustment		7,909,000
Change in accrued interest receivable and other assets	1,218,000	(4,492,000)	(53,000)
Impairment of goodwill	0
Accretion of purchase accounting adjustment on time deposits	(100,000)
Amortization of purchase accounting adjustment on notes payable and other borrowingsStock	81,000
Amortization of junior subordinated debentures issuance costs	47,000	48,000	48,000
Amortization of senior notes issuance costs	100,000	102,000	4,000
Change in accrued interest payable and other liabilities	1,390,000	1,582,000	967,000
Stock based compensation	2,257,000	1,181,000	657,000
Net cash provided by operating activities	54,907,000	37,105,000	27,256,000
Cash flows from investing activities
Proceeds from maturities and calls including pay down of securities available-for-sale	40,641,000	117,389,000	78,305,000
Proceeds from sales of securities available-for-sale	94,663,000	232,462,000	306,400,000
Purchases of securities available-for-sale	(75,044,000)	(343,470,000)	(210,681,000)
Proceeds from maturities and calls including pay down of securities held-to-maturity			3,372,000
Net disbursements/proceeds from sales (purchases) of FHLBC stock	(295,000)	(2,250,000)	600,000
Net disbursements/proceeds from (purchases) sales of FRB stock	(1,421,000)
Net change in loans	(52,706,000)	(141,683,000)	(125,540,000)
Proceeds from claims on BOLI	1,204,000
Improvements in other real estate owned	(59,000)		(16,000)
Proceeds from sales of other real estate owned, net of participation purchase	4,782,000	6,107,000	7,830,000
Proceeds from disposition of premises and equipment		13,000
Net purchases of premises and equipment	(1,895,000)	(1,055,000)	(1,986,000)
Cash paid for acquisition, net of cash and cash equivalent retained	(35,711,000)		(181,357,000)
Net cash provided by (used in) investing activities	(25,841,000)	(132,487,000)	(123,073,000)
Cash flows from financing activities
Net change in deposits	(54,650,000)	56,140,000	58,805,000
Net change in securities sold under repurchase agreements	11,091,000	4,203,000	(8,355,000)
Net change in other short-term borrowings	23,625,000	45,000,000	55,000,000
Payment of senior note issuance costs		(42,000)
Proceeds from the issuance of senior notes			43,994,000
Repayment of subordinate debt			(45,000,000)
Net change in notes payable and other borrowings	(8,069,000)		(500,000)
Proceeds from exercise of stock options	33,000		11,000
Dividends paid common stock	(1,189,000)	(1,184,000)	(888,000)
Purchase of treasury stock	(505,000)	(236,000)	(254,000)
Net cash (used in) provided by financing activities	(29,664,000)	103,881,000	102,813,000
Net change in cash and cash equivalents	(598,000)	8,499,000	6,996,000
Cash and cash equivalents at beginning of period	55,833,000	47,334,000	40,338,000
Cash and cash equivalents at end of period	55,235,000	55,833,000	47,334,000
Supplemental cash flow information
Income taxes paid		430,000	211,000
Interest paid for deposits	7,644,000	5,145,000	4,275,000
Interest paid for borrowings	8,323,000	7,362,000	5,330,000
Non-cash transfer of loans to other real estate owned	$ 2,915,000	3,701,000	1,223,000
Non-cash transfer of premises to other real estate owned		$ 95,000	562,000
Non-cash transfer of securities available-for-sale to securities held-to-maturity			$ 244,823,000

Consolidated Statements of Chan

Consolidated Statements of Changes in Stockholders' Equity - USD ($) $ in Thousands	Common Stock	Additional Paid In Capital	Retained Earnings	Accumulated Other Comprehensive Income (Loss)	Treasury Stock	Total
Balance at Dec. 31, 2015	$ 34,427	$ 115,918	$ 114,209	$ (12,659)	$ (95,966)	$ 155,929
Increase (Decrease) in Stockholders' Equity
Net income			15,684			15,684
Other comprehensive income, net of tax				3,897		3,897
Dividends declared and paid			(888)			(888)
Vesting of restricted stock	106	(106)
Recapture of restricted stock		174				174
Stock options exercised	1	10				11
Stock based compensation		657				657
Purchase of treasury stock					(254)	(254)
Balance at Dec. 31, 2016	34,534	116,653	129,005	(8,762)	(96,220)	175,210
Increase (Decrease) in Stockholders' Equity
Net income			15,138			15,138
Other comprehensive income, net of tax				10,241		10,241
Dividends declared and paid			(1,184)			(1,184)
Vesting of restricted stock	92	(92)
Stock based compensation		1,181				1,181
Purchase of treasury stock					(236)	(236)
Balance at Dec. 31, 2017	34,626	117,742	142,959	1,479	(96,456)	200,350
Increase (Decrease) in Stockholders' Equity
Net income			34,012			34,012
Other comprehensive income, net of tax				(5,877)		(5,877)
Dividends declared and paid			(1,189)			(1,189)
Vesting of restricted stock	91	(926)			835
Reclassification of stranded tax effects			(319)	319
Stock options exercised	3	8			22	33
Stock based compensation		2,257				2,257
Purchase of treasury stock					(505)	(505)
Balance at Dec. 31, 2018	$ 34,720	$ 119,081	$ 175,463	$ (4,079)	$ (96,104)	$ 229,081

Consolidated Statements of Ch_2

Consolidated Statements of Changes in Stockholders' Equity (Parenthetical) - $ / shares	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Consolidated Statements of Changes in Stockholders' Equity
Dividend declared and paid (per share)	$ 0.04	$ 0.04

Summary of Significant Accounti

Summary of Significant Accounting Policies	12 Months Ended
	Dec. 31, 2018
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies	Old Second Bancorp, Inc. and Subsidiaries Notes to Consolidated Financial Statements December 31, 2018, 2017 and 201 6 (Table amounts in thousands, except per share data) Note 1: Summary of Significant Accounting Policies The consolidated financial statements of Old Second Bancorp, Inc., and Subsidiaries (the “Company”) include the financial statements of Old Second Bancorp, Inc., a registered bank holding company, and its wholly-owned bank, Old Second National Bank (the “Bank”). The Company uses the accrual basis of accounting for financial reporting purposes. Certain amounts in prior year financial statements have been reclassified to conform to the 2018 presentation. Use of Estimates – The preparation of consolidated financial statements in conformity with generally accepted accounting principles (“GAAP”) and following general practices within the banking industry requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Although these estimates and assumptions are based on the best available information, actual results could differ from those estimates. Principles of Consolidation – The accompanying consolidated financial statements include the accounts and results of operations of the Company and its subsidiaries after elimination of all significant intercompany accounts and transactions. Assets held in a fiduciary or agency capacity are not assets of the Company or its subsidiaries and are not included in the consolidated financial statements. Segment Reporting – An operating segment is a component of a business entity that engages in business activity from which it may earn revenues and/or incur expenses. It has operating results that are reviewed regularly by the entity’s chief operating decision maker in order to make decisions about resource allocation and performance assessment, and the segment has discrete financial information available for this assessment. As of December 31, 2018, the Company had one operating segment, which is community banking. Therefore, segment reporting is not required. Cash and Cash Equivalents – For purposes of the Consolidated Statements of Cash Flows, management has defined cash and cash equivalents to include cash and due from banks, interest-bearing deposits in other banks, and other short-term investments, such as federal funds sold and securities purchased under agreements to resell. The classification of cash and cash equivalents includes those assets held in the form of cash or liquid instruments with a maturity of 90 days or less. Securities – Securities are classified as available-for-sale or held-to-maturity at the time of purchase or transfer. Securities that are classified as available-for-sale are carried at fair value. Unrealized gains and losses, net of related deferred income taxes, are recorded in stockholders’ equity as a separate component of accumulated other comprehensive income or loss. Unrealized gains and losses are not included in the calculation of regulatory capital. Securities held-to-maturity are carried at amortized cost and the discount or premium created at acquisition or in the transfer from available-for-sale is accreted or amortized to the maturity or expected payoff date but not an earlier call. Discounts are accreted into interest income over the estimated life of the related security and premiums are amortized into income to the earlier of the call date or estimated life of the related security using the level yield method. Purchases and sales of securities are recognized on a trade date basis. Realized securities gains or losses are reported in securities gains (losses), net, in the Consolidated Statements of Income. The cost of securities sold is based on the specific identification method. On a quarterly basis, the Company makes an assessment (at the individual security level) to determine whether there have been any events or circumstances indicating that a security with an unrealized loss is other-than-temporarily impaired (“OTTI”). In evaluating OTTI, the Company considers many factors, including the severity and duration of the impairment; the financial condition and near-term prospects of the issuer, which for debt securities considers external credit ratings and recent downgrades; its ability and intent to hold the security for a period of time sufficient for a recovery in value; and the likelihood that it will be required to sell the security before a recovery in value, which may be at maturity. The amount of the impairment related to other factors is recognized in other comprehensive income (loss) unless management intends to sell the security or believes it is more likely than not that it will be required to sell the security prior to full recovery. Federal Home Loan Bank and Federal Reserve Bank Stock – The Company owns the stock of the Federal Home Loan Bank of Chicago (“FHLBC”) and the Federal Reserve Bank of Chicago (“FRBC”). Both of these entities require the Bank to invest in their nonmarketable stock as a condition of membership. The FHLBC is a governmental sponsored entity. The Bank continues to utilize the various products and services of the FHLBC and management considers this stock to be a long-term investment. FHLBC members are required to own a certain amount of stock based on the level of borrowings and other factors, and may invest in additional amounts. FHLBC stock is carried at cost, classified as a restricted security, and periodically evaluated for impairment based on ultimate recovery of par value. The Company’s ability to redeem the shares owned is dependent on the redemption practices of the FHLBC. The Company records dividends in income on the ex-dividend date. FRBC stock is redeemable at par, and therefore fair value equals cost. Loans Held-for-Sale – The Bank originates residential mortgage loans, which consist of loan products eligible for sale to the secondary market. Residential mortgage loans eligible for sale in the secondary market are carried at fair market value. The fair value of loans held-for-sale is determined using quoted secondary market prices on similar loans. Loans – Loans held-for-investment are carried at the principal amount outstanding, including certain net deferred loan origination fees and costs. Loans purchased as a result of a business combination are recorded at estimated fair value on the acquisition date, with no carryover of the related allowance for loan and lease losses recorded by the acquiree at the time of purchase. These loans are segregated into two classifications upon purchase: 1) purchased non-credit impaired (“non-PCI”) loans, accounted for in accordance with FASB ASC Subtopic 310-20 “ Nonrefundable Fees and Costs ” (“ASC 310-20”), as these loans do not have evidence of credit deterioration since origination. The premiums and discounts created when ASC 310-20 loans are recorded at their fair values at acquisition are recorded to income over the remaining life of the loan as an adjustment to the related loan’s yield; and 2) purchased credit impaired (“PCI”) loans, accounted for under FASB ASC Subtopic 310-30, “ Loans and Debt Securities Acquired with Deteriorated Credit Quality ” (“ASC 310-30”) as they display signs of credit deterioration since origination. Interest income, through accretion of the difference between the carrying value of the loans and the expected cash flows, is recognized on the acquired loans accounted for under ASC 310-30. Interest income on loans is accrued based on principal amounts outstanding. Loan and lease origination fees, commitment fees, and certain direct loan origination costs are deferred and amortized over the life of the related loans or commitments as a yield adjustment. The acquisition adjustment discount related to purchased loans is accreted into interest income over the contractual life of each loan, or is generally taken into income immediately upon payoff or renewal of the loan. Fees related to standby letters of credit, whose ultimate exercise is remote, are amortized into fee income over the estimated life of the commitment. Other credit-related fees are recognized as fee income when earned. Concentration of Credit Risk – Most of the Company’s business activity is with customers located within Cook, DeKalb, DuPage, Kane, Kendall, LaSalle and Will counties in Illinois. These banking centers surround or are within the Chicago metropolitan area. Therefore, the Company’s exposure to credit risk is significantly affected by changes in the economy in that market area since the Bank generally makes loans within its market. There are no significant concentrations of loans where the customers’ ability to honor loan terms is dependent upon a single economic sector. Commercial Loans – Such credits typically comprise working capital loans, loans for physical asset expansion, asset acquisition loans and other commercial and industrial business loans. Loans to closely held businesses will generally be guaranteed in full or for a meaningful amount by the businesses’ major owners. Commercial loans are made based primarily on the historical and projected cash flow of the borrower and secondarily on the underlying collateral provided by the borrower. The cash flows of borrowers, however, may not behave as forecasted and collateral securing loans may fluctuate in value due to economic or individual performance factors. Minimum standards and underwriting guidelines have been established for all commercial loan types. Lease Financing Receivables – Lease financing receivables are subject to underwriting standards and processes similar to commercial loans. These loans are often secured by equipment or transportation assets, and are made based primarily on the historical and projected cash flow of the borrower and secondarily on the underlying collateral provided by the borrower. The cash flows of borrowers, however, may not behave as forecasted and collateral securing loans may fluctuate in value due to economic or individual performance factors. Real Estate - Commercial Loans – Real estate - commercial loans are subject to underwriting standards and processes similar to commercial and industrial loans. These are loans secured by mortgages on real estate collateral. Commercial real estate loans are viewed primarily as cash flow loans and the repayment of these loans is largely dependent on the successful operation of the property. Loan performance may be adversely affected by factors impacting the general economy or conditions specific to the real estate market such as geographic location and/or property type. Real Estate - Construction Loans – The Company defines real estate - construction loans as loans where the loan proceeds are controlled by the Company and used exclusively for the improvement or development of real estate in which the Company holds a mortgage. Due to the inherent risk in this type of loan, they are subject to other industry specific policy guidelines outlined in the Company’s Credit Risk Policy and are monitored closely. Real Estate - Residential Loans – These are loans that are extended to purchase or refinance 1-4 family residential dwellings, or to purchase or refinance vacant lots intended for the construction of a 1-4 family home. Residential real estate loans are considered homogenous in nature. Homes may be the primary or secondary residence of the borrower or may be investment properties of the borrower. Home Equity Lines of Credit (“HELOCs”) – These are lines of credit that are extended to refinance 1-4 family residential dwellings, or to finance the borrower’s needs and collateralized by the borrower’s residence. These lines may be fixed or variable in nature, and the home serving as collateral may also have a first lien outstanding. Consumer Loans – Consumer loans include loans extended primarily for consumer and household purposes. These also include overdrafts and other items not captured by the definitions above. Nonaccrual Loans – Generally, commercial and consumer loans, as well as loans secured by real estate are placed on nonaccrual status (i) when either principal or interest payments become 90 days or more past due based on contractual terms unless the loan is sufficiently collateralized such that full repayment of both principal and interest is expected and is in the process of collection within a reasonable period or (ii) when an individual analysis of a borrower’s creditworthiness indicates a credit should be placed on nonaccrual status whether or not the loan is 90 days or more past due. When a loan is placed on nonaccrual status, unpaid interest credited to income is reversed. Generally, after the loan is placed on nonaccrual, all debt service payments are applied to the principal on the loan. Nonaccrual loans are returned to accrual status when the financial position of the borrower and other relevant factors indicate there is no longer doubt that the Company will collect all principal and interest due. Commercial, consumer and real estate loans are generally charged-off when deemed uncollectible. A loss is recorded at that time if the net realizable value can be quantified and it is less than the associated principal outstanding. Troubled Debt Restructurings (“TDRs”) – A restructuring of debt is considered a TDR when (i) the borrower is experiencing financial difficulties and (ii) the creditor grants a concession, such as forgiveness of principal, reduction of the interest rate, changes in payments, or extension of the maturity, that it would not otherwise consider. Loans are not classified as TDRs when the modification is short-term or results in only an insignificant delay or shortfall in the payments to be received. The Company’s TDRs are determined on a case-by-case basis in connection with ongoing loan collection processes. The Company does not accrue interest on any TDRs unless it believes collection of all principal and interest under the modified terms is reasonably assured. For TDRs to accrue interest, the borrower must demonstrate both some level of past performance and the capacity to perform under the modified terms. Generally, six months of consecutive payment performance by the borrower under the restructured terms is required before TDRs are returned to accrual status. However, the period could vary depending on the individual facts and circumstances of the loan. An evaluation of the borrower’s current creditworthiness is used to assess whether the borrower has the capacity to repay the loan under the modified terms. This evaluation includes an estimate of expected cash flows, evidence of strong financial position, and estimates of the value of collateral, if applicable. Impaired Loans – Impaired loans consist of nonaccrual loans and TDRs (both accruing and on nonaccrual). A loan is considered impaired when it is probable that the Company will be unable to collect all contractual principal and interest due according to the terms of the loan agreement based on current information and events. With the exception of TDRs still accruing interest, loans deemed to be impaired are classified as nonaccrual and are exclusive of smaller homogeneous loans, such as HELOCs, 1-4 family mortgages, and consumer loans. 90-Days or Greater Past Due Loans – 90-days or greater past due loans are loans with principal or interest payments three months or more past due, but that still accrue interest. The Company continues to accrue interest if it determines these loans are sufficiently collateralized and the process of collection will conclude within a reasonable time period. Allowance for Loan and Lease Losses (“ALLL”) – The ALLL is calculated according to GAAP standards and is maintained by management at a level believed adequate to absorb estimated losses inherent in the existing loan portfolio. Determination of the ALLL is inherently subjective since it requires significant estimates and management judgment, and includes a level of imprecision given the difficulty of identifying and assessing the factors impacting loan repayment and estimating the timing and amount of losses. While management utilizes its best judgment and information available, the ultimate adequacy of the ALLL is dependent upon a variety of factors beyond the Company’s direct control, including the performance of the loan portfolio, consideration of current economic trends, changes in interest rates and property values, the amounts and timing of expected future cash flows on impaired loans, estimated losses on pools of homogeneous loans based on an analysis that uses historical loss experience, portfolio growth and concentration risk, management and staffing changes, the interpretation of loan risk classifications by regulatory authorities and other credit market factors. While each component of the ALLL is determined separately, the entire balance is available for the entire loan portfolio. Loans deemed to be uncollectible are charged-off against the ALLL while recoveries of amounts previously charged-off are credited to the ALLL. Approved releases from previously established loan loss reserves authorized under our allowance methodology also reduce the ALLL. Additions to the allowance are established through the provision for loan and lease losses charged to expense. The ALLL methodology consists of (i) specific reserves established for probable losses on individual loans for which the recorded investment in the loan exceeds the present value of expected future cash flows or the net realizable value of the underlying collateral, if collateral dependent, (ii) an allowance based on a historical loss analysis that uses credit loss experience for the prior 20 quarters for each loan category, and (iii) the impact of other internal and external qualitative and credit market factors as assessed by management through detailed loan review, allowance analysis and credit discussions. In 2016, the Company significantly refined its ALLL methodology to further stratify the loan portfolio and apply unique factors to each segment. The changes implemented in 2016 segregate the total loan portfolio into further detail, moving from seven loan classifications to nine when applying management risk factors, and from four loan classifications to nine when applying historical loss rates. The Company also enhanced the prior process of applying management risk factors for changes in loans portfolio trends, such as factors for changes in the trend or volume of past due and classified loans, changes in the nature and volume of the portfolio and concentrations, changes in lending policy, procedures, management and staffing, and other external factors. These factors were historically analyzed in the aggregate to arrive at one risk factor per loan classification; under the revised methodology, the Company assigns each of these components its own risk factor, as well as encompasses an additional risk rating for loans rated as pass/watch. The Company continued to refine its ALLL methodology in 2017, with implementation of additional management factor classifications for newer loan portfolios, such as the Company’s recent purchase of home equity lines of credit (“HELOCs”) and the recently expanded business development company loan portfolio, as these portfolios have not been outstanding long enough to be sufficiently seasoned. In addition, the Company revised the risk weightings for the historical loss factors to allocate an increase in the loss factor applied in the earliest quarter, and a like reduction of the loss factor in the most recent quarter, as management believes the lower charge-off levels in the more recent quarters will likely not continue long-term. The Company refined its ALLL methodology again in 2018, as the Company determined that a minimum threshold of two basis points should be used for those quarters within the historical loss calculation with minimal or no losses incurred. In addition, a base line for reserves was set for economic conditions, past due and classified loans, loan portfolio/ concentrations, general and external factors. These factors are evaluated quarterly by the Bank’s ALLL Committee and the ASC 450 percentages are adjusted according to the overall bias in the individual factors (up, down or neutral). In the first quarter of 2018, these baseline levels were modified to establish floors and ceilings for each management factor. The establishment of floors and ceilings for management factors will allow management to evaluate changes to factors within prescribed guidelines and to remain consistent with factor determination in a stressed scenario, as a ceiling could be applied. These modifications to the Company’s ALLL methodology are intended to more accurately reflect all portfolio risk, and resulted in a consistent balance for the overall unallocated component of the allowance over the past two years. The unallocated component of the allowance was $537,000 as of December 31, 2018, compared to $542,000 as of December 31, 2017 and $435,000 as of December 31, 2016. All calculations conform to GAAP. Premises and Equipment – Premises, furniture, equipment, and leasehold improvements are stated at cost less accumulated depreciation and amortization. Depreciation expense is determined by the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized on a straight-line basis over the shorter of the life of the asset or the lease term including anticipated renewals. Rates of depreciation are generally based on the following useful lives: buildings, 25 to 40 years; building improvements, 3 to 15 years or longer under limited circumstances; and furniture and equipment, 3 to 10 years. Gains and losses on dispositions are included in other noninterest income in the Consolidated Statements of Income. Maintenance and repairs are charged to operating expenses as incurred, while improvements that conform to definitions of tangible property improvements are capitalized and depreciated over the estimated remaining life. Other Real Estate Owned (“OREO”) – Real estate assets acquired in settlement of loans are recorded at the fair value of the property when acquired, less estimated costs to sell, establishing a new cost basis. Physical possession of residential real estate property collateralizing a consumer mortgage loan occurs when legal title is obtained upon foreclosure or when the borrower conveys all interest in the property to satisfy the loan through completion of a deed in lieu of foreclosure or through a similar legal agreement. Any deficiency between the net book value and fair value at the foreclosure or deed in lieu date is charged to the ALLL. Any reduction in OREO carrying value within 90 days of transfer to OREO would be charged to the ALLL. If a determination is made more than 90 days after the transfer to OREO that the fair value for the OREO property has declined, an OREO valuation allowance is established for the decrease between the recorded value and the updated fair value less costs to sell. Such declines are included in other noninterest expense in the Consolidated Statements of Income. A subsequent reversal of an OREO valuation adjustment can occur, but the resultant carrying value cannot exceed the cost basis established at transfer of the loan to OREO. Operating costs after acquisition are also expensed. Mortgage Servicing Rights – The Bank is also involved in the business of servicing mortgage loans. Servicing activities include collecting principal, interest, and escrow payments from borrowers, making tax and insurance payments on behalf of the borrowers, monitoring delinquencies, executing foreclosure proceedings, and accounting for and remitting principal and interest payments to the investors. Mortgage servicing rights represent the right to a stream of cash flows and an obligation to perform specified residential mortgage servicing activities. Mortgage loans that the Company is servicing for others aggregated to $711.1 million and $695.1 million at December 31, 2018, and 2017, respectively. Mortgage loans that the Company is servicing for others are not included in the consolidated balance sheets. Fees received in connection with servicing loans for others are recognized as earned. Loan servicing costs are charged to expense as incurred. Servicing rights are recognized separately as assets when they are acquired through sales of loans and servicing rights are retained. Servicing rights are initially recorded at fair value with the effect recorded in net gains on sales of mortgage loans in the Consolidated Statements of Income. Fair value is based on market prices for comparable mortgage servicing contracts, when available, or alternatively, is based on a valuation model that calculates the present value of estimated future net servicing income. The valuation model incorporates assumptions that market participants would use in estimating future net servicing income, such as the cost to service, the discount rate, the custodial earnings rate, an inflation rate, ancillary income, prepayment speeds and default rates and losses. Servicing fee income, which is included in the Consolidated Statements of Income as mortgage servicing income, is recorded for fees earned for servicing loans. The fees are based on a contractual percentage of the outstanding principal or a fixed amount per loan and are recorded as income when earned. Under the fair value measurement method, the Company measures mortgage servicing rights at fair value at each reporting date, reports changes in fair value of servicing assets in earnings in the period in which the changes occur, and includes these changes in mortgage servicing rights mark to market in the Consolidated Statements of Income. The fair values of mortgage servicing rights are subject to significant fluctuations as a result of changes in estimated and actual prepayment speeds and default rates and losses. Bank-Owned Life Insurance (“BOLI”) – BOLI represents life insurance policies on the lives of certain Company employees (both current and former) for which the Company is the sole owner and beneficiary. These policies are recorded as an asset on the Consolidated Balance Sheets at their cash surrender value (“CSV”) or the amount that could be realized. The change in CSV is recorded as an increase in cash surrender value of bank-owned life insurance in the Consolidated Statements of Income in noninterest income. In addition, insurance proceeds received, net of the original premium investment, are recorded as death benefit realized on bank-owned life insurance in the Consolidated Statements of Income in noninterest income. Goodwill and Core Deposit Intangible – Goodwill is the excess of an acquisition’s purchase price over the fair value of identified net assets acquired in an acquisition. Goodwill is not deemed to have definitive life span, and therefore is not amortized, but is subject to annual review for impairment. The annual review performed is qualitative in nature, and factors reviewed include macroeconomic data, industry specific data, current market conditions, and the Company’s overall financial performance. Based on management’s annual review of goodwill in the fourth quarter of 2018, no goodwill impairment was noted. The core deposit intangible (“CDI”) is being amortized on an accelerated method over a ten year estimated useful life. In 2018, CDI of $3.1 million was recorded stemming from the ABC Bank acquisition. As of December 31, 2018, $2.7 million of the ABC Bank CDI remained, which is in addition to the $465,000 of CDI remaining from the Talmer branch purchase as of December 31, 2018. Total CDI amortization expense of $387,000 was recorded in 2018. The expected future annual amortization expense for each of the next five years is approximately $483,000, $416,000, $380,000, $372,000, and $372,000. Debt Issuance Costs – Costs associated with the issuance of debt are presented in the Consolidated Balance Sheet as a direct reduction from the carrying value of that debt liability. The deferred issuance costs are amortized over the life the related debt instrument, and included within the debt’s interest expense. Loss Contingencies – Loss contingencies, including claims and legal actions arising in the ordinary course of business, are recorded as liabilities when the likelihood of loss is probable and an amount or range of loss can be reasonably estimated. Management does not believe there are such matters that will have a material effect on the financial statements. Wealth Management – Assets held in a fiduciary or agency capacity for customers are not included in the consolidated financial statements as they are not assets of the Company or its subsidiaries. Fee income is included as a component of noninterest income in the Consolidated Statements of Income. Advertising Costs – All advertising costs incurred by the Company are expensed in the period in which they are incurred. Equity Incentive Plan – Compensation cost is recognized for stock options and restricted stock awards issued to employees based upon the fair value of the awards at the date of grant. A binomial model is utilized to estimate the fair value of stock options, which utilizes assumptions for expected volatilities based on the previous five-year historical volatilities of the Company's common stock. Historical data is used to estimate option exercise rates and post-vesting termination behavior, and the risk-free interest rate for the expected term of the option is based on the Treasury yield curve in effect at the time of grant. The market price of the Company’s common stock at the date of grant is used for restricted stock awards, which include restricted stock units. Compensation cost is recognized over the required service period, generally defined as the vesting period. Once the award is settled, the Company would determine whether the cumulative tax deduction exceeded the cumulative compensation cost recognized in the Consolidated Statement of Income. The cumulative tax deduction would include both the deductions from the dividends and the deduction from the exercise or vesting of the award. If the tax benefit received from the cumulative deductions exceeds the tax effect of the recognized cumulative compensation cost, the excess would be recognized as a credit to income tax expense. Income Taxes – The Company files income tax returns in the U.S. federal jurisdiction, and in the states of Illinois, Indiana and Wisconsin. The provision for income taxes is based on income in the consolidated financial statements, rather than amounts reported on the Company’s income tax return. Income tax expense is the total of the current year income tax due or refundable and the change in deferred tax assets and liabilities. Any change in tax rates will be recorded in the period in which the law is enacted. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using the enacted tax rates that are expected to apply to taxable income in years in which those temporary differences are expected to be recovered or settled. As of December 31, 2018 and 2017, the Company evaluated tax positions taken for filing with the Internal Revenue Service and all state jurisdictions in which it operates. The Company believes that income tax filing positions will be sustained under examination and does not anticipate any adjustments that would result in a material adverse effect on the Company’s financial condition, results of operations, or cash flows. Accordingly, the Company has not recorded any reserves or related accruals for interest and penalties for uncertain tax positions at December 31, 2018 and 2017. The Company is currently open to audit under the statute of limitations by the Internal Revenue Service from 2015 to 2017, the state of Illinois from 2015 to 2017, and the states of Wisconsin and Indiana from 2009 to 2017. Earnings Per Common Share (“EPS”) – Basic EPS is computed by dividing net income applicable to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted EPS is computed by dividing net income applicable to common stockholders by the weighted-average number of common shares outstanding plus the number of additional common shares that would have been outstanding if the dilutive potential shares had been issued. The Company’s poten

Acquisitions

Acquisitions	12 Months Ended
	Dec. 31, 2018
Talmer
Business Acquisition [Line Items]
Acquisitions	Note 2: Acquisitions Greater Chicago Financial Corp. and ABC Bank Acquisition On April 20, 2018, the Company acquired Greater Chicago Financial Corp. (“GCFC”) and its wholly-owned subsidiary, ABC Bank, which operated four branches in the Chicago metro area. In addition to the acquisition price of $41.1 million, the Company retired the convertible and nonconvertible debentures held by GCFC upon acquisition, which totaled $6.6 million, including interest due. The purchase and the retirement of the debentures was funded with the Company’s cash on hand, and all GCFC common stock was retired and cancelled simultaneous with the close of the transaction. The Company acquired $227.6 million of loans, net of purchase accounting adjustments, and $248.5 million of deposits, net of purchase accounting adjustments for time deposits. Purchase accounting adjustments recorded include a loan valuation mark of $11.2 million, a core deposit intangible of $3.1 million, a fixed asset valuation adjustment of $1.5 million, and goodwill of $10.2 million. In addition, a deferred tax asset of $3.5 million was recorded as of the date of acquisition based on analysis of the fair value of assets acquired, less liabilities assumed. None of the $10.2 million recorded as goodwill is expected to be deductible for tax purposes. Acquisition related costs incurred by the Company for the year ended December 31, 2018, totaled $3.5 million, pre-tax, and included $1.1 million of salaries and employee benefits related expenses, and $1.8 million of data processing, computer and ATM related conversion costs. Acquisition costs incurred for the year ending December 31, 2017, related to the merger with GCFC were $65,000, and were expensed as incurred. The assets and liabilities associated with the acquisition of GCFC were recorded in the Consolidated Balance Sheets at their estimated fair values as of the acquisition date. In many cases the determination of these fair values required management to make estimates about discount rates, future expected cash flows, market conditions and other future events that are highly subjective in nature and subject to change, as noted below. The following table shows the estimated fair value of the assets acquired and liabilities assumed as of April 20, 2018. These fair value estimates are preliminary and subject to refinement for up to one year after the closing date of the acquisition or the date we receive the information about the facts and circumstances that existed at the acquisition date. Subsequent adjustments, if necessary, will be prospectively reflected in future filings, and may impact loans, other assets, deferred tax assets, net, and goodwill. The below table summarizes the assets acquired, less the liabilities assumed, related to the GCFC/ABC Bank acquisition. All amounts are listed at their estimated fair values as of date of acquisition, and have been accounted for under the acquisition method of accounting. GCFC/ABC Bank Acquisition Summary As of Date of Acquisition April 20, 2018 Assets Cash and due from banks $ 6,669 Interest bearing deposits with financial institutions 500 Securities available-for-sale, at fair value 72,091 Federal funds sold 4,300 FHLBC stock 1,549 Loans 227,594 Premises and equipment 5,339 Other real estate owned 401 Goodwill and core deposit intangible 13,280 Deferred tax assets, net 3,459 Other assets 1,767 Total assets $ 336,949 Liabilities Noninterest bearing demand $ 58,005 Savings, NOW and money market 91,494 Time 98,999 Total deposits 248,498 Securities sold under repurchase agreements 5,623 Other short-term borrowings 10,875 Notes payable and other borrowings 23,367 Other liabilities 1,406 Total liabilities 289,769 Cash consideration paid 47,180 Total Liabilities Assumed and Cash Consideration Paid for Acquisition $ 336,949 Loans acquired in the GCFC acquisition were initially recorded at fair value with no separate allowance for loan losses. The Company reviewed the loans at acquisition to determine which loans should be considered PCI loans, defining impaired loans as those that were either not accruing interest or exhibited credit risk factors consistent with nonperforming loans at the acquisition date, or non-PCI loans, as addressed in the Company’s significant accounting policies. The following table represents the acquired loans as of date of acquisition and as of December 31, 2018: April 20, 2018 December 31, 2018 ABC Bank Acquired Loans PCI Non-PCI PCI Non-PCI Fair Value $ 11,360 $ 216,234 $ 10,965 $ 171,520 Contractually required principal and interest payments 19,447 220,308 18,106 173,605 Best estimate of contractual cash flows not expected to be collected 6,537 2,511 5,969 1,175 Best estimate of contractual cash flows expected to be collected 12,910 217,797 12,137 172,430 Talmer Bank and Trust Branch Purchase On October 28, 2016, the Bank completed the acquisition of the Chicago branch of Talmer Bank and Trust, the banking subsidiary of Talmer Bancorp, Inc. (“Talmer”). As a result of this transaction, the Bank acquired $221.0 million of loans, net of fair value adjustment, and $48.9 million of deposits. The purchase resulted in the Company establishing a metropolitan Chicago office presence with a strong commercial client focus, and retention of an experienced lending team. The acquisition was funded with security sales and cash on hand, and was recorded applying the acquisition method of accounting. Net assets acquired totaled $181.5 million. Acquisition expenses incurred in 2016 related to the Talmer branch purchase totaled $269,000 as of December 31, 2016; all material acquisition costs identified were paid or accrued as of year end 2016.

Cash and Due from Banks

Cash and Due from Banks	12 Months Ended
	Dec. 31, 2018
Cash and Due from Banks.
Cash and Due from Banks	Note 3: Cash and Due from Banks The Bank is required to maintain reserve balances with the FRBC. In accordance with the FRBC requirements, the average reserve balances were $11.3 million and $10.6 million, for the years December 31, 2018, and 2017, respectively. As of December 31, 2018 and 2017, the required reserve balance was $10.8 million and $11.0 million, respectively. The nature of the Company’s business requires that it maintain amounts with other banks and federal funds which, at times, may exceed federally insured limits. Management monitors these correspondent relationships, and the Company has not experienced any losses in such accounts.

Securities

Securities	12 Months Ended
	Dec. 31, 2018
Securities
Securities	Note 4: Securities Investment Portfolio Management The following table summarizes the amortized cost and fair value of the securities portfolio at December 31, 2018 and December 31, 2017, and the corresponding amounts of gross unrealized gains and losses: Gross Gross Amortized Unrealized Unrealized Fair December 31, 2018 Cost Gains Losses Value Securities available-for-sale U.S. Treasuries $ 4,006 $ - $ (83) $ 3,923 U.S. government agencies 11,112 - (161) 10,951 U.S. government agencies mortgage-backed 14,407 45 (377) 14,075 States and political subdivisions 277,112 1,916 (4,961) 274,067 Collateralized mortgage obligations 66,494 79 (2,144) 64,429 Asset-backed securities 108,574 1,165 (225) 109,514 Collateralized loan obligations 65,162 24 (897) 64,289 Total securities available-for-sale $ 546,867 $ 3,229 $ (8,848) $ 541,248 Gross Gross Amortized Unrealized Unrealized Fair December 31, 2017 Cost Gains Losses Value Securities available-for-sale U.S. Treasury $ 4,002 $ - $ (55) $ 3,947 U.S. government agencies 13,062 8 (9) 13,061 U.S. government agencies mortgage-backed 12,372 7 (165) 12,214 States and political subdivisions 272,240 7,116 (1,264) 278,092 Corporate bonds 823 21 (11) 833 Collateralized mortgage obligations 66,892 202 (1,155) 65,939 Asset-backed securities 113,983 862 (1,913) 112,932 Collateralized loan obligations 54,271 251 (101) 54,421 Total securities available-for-sale $ 537,645 $ 8,467 $ (4,673) $ 541,439 Nonmarketable equity investments include FHLBC stock and FRBC stock. FHLBC stock was $7.2 million and $5.4 million at December 31, 2018 and December 31, 2017, respectively. FRBC stock was $6.2 million and $4.8 million at December 31, 2018 and December 31, 2017, respectively. Our FHLBC stock is necessary to maintain access to FHLBC advances. Securities valued at $318.4 million as of December 31, 2018, an increase from $301.0 million at year-end 2017, were pledged to secure deposits and borrowings, and for other purposes. The fair value, amortized cost and weighted average yield of debt securities at December 31, 2018, by contractual maturity, were as follows in the table below. Securities not due at a single maturity date are shown separately. Weighted Amortized Average Fair Securities available-for-sale Cost Yield Value Due in one year or less $ 494 0.56 % $ 495 Due after one year through five years 6,910 2.00 6,861 Due after five years through ten years 6,202 3.25 6,275 Due after ten years 278,624 3.02 275,310 292,230 2.99 288,941 Mortgage-backed and collateralized mortgage obligations 80,901 3.24 78,504 Asset-backed securities 108,574 3.65 109,514 Collateralized loan obligations 65,162 5.05 64,289 Total securities available-for-sale $ 546,867 3.41 % $ 541,248 At December 31, 2018, the Company’s investments include asset-backed securities totaling $93.1 million that are backed by student loans originated under the Federal Family Education Loan program (“FFEL”). Under the FFEL, private lenders made federally guaranteed student loans to parents and students. While the program was modified several times before elimination in 2010, FFEL securities are generally guaranteed by the U.S. Department of Education (“DOE”) at not less than 97% of the principal amount of the loans. The guarantee will reduce to 85% if the DOE receives reimbursement requests in excess of 5% of insured loans; reimbursement will drop to 75% if reimbursement requests exceed 9% of insured loans. As of December 31, 2018, the likelihood of the decrease in the government guarantee was minimal as the average rate of reimbursement for 2018 was less than 1.0%. The Company has accumulated the securities of the following three different originators that individually amount to over 10% of the Company’s stockholders equity. The amortized cost and fair value of securities related to these three issuers are as follows: December 31, 2018 Amortized Fair Issuer Cost Value GCO Education Loan Funding Corp $ 27,739 $ 27,763 Towd Point Mortgage Trust 34,308 33,318 Student Loan Marketing Association (“SLMA”) 25,808 26,119 Securities with unrealized losses at December 31, 2018, and December 31, 2017, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, were as follows: Less than 12 months 12 months or more December 31, 2018 in an unrealized loss position in an unrealized loss position Total Number of Unrealized Fair Number of Unrealized Fair Number of Unrealized Fair Securities available-for-sale Securities Losses Value Securities Losses Value Securities Losses Value U.S. Treasuries - $ - $ - 1 $ 83 $ 3,923 1 $ 83 $ 3,923 U.S. government agencies 3 100 7,385 1 61 3,566 4 161 10,951 U.S. government agencies mortgage-backed - - - 11 377 11,439 11 377 11,439 States and political subdivisions 4 126 17,713 33 4,835 110,326 37 4,961 128,039 Collateralized mortgage obligations 2 309 15,211 10 1,835 43,687 12 2,144 58,898 Asset-backed securities - - - 4 225 16,473 4 225 16,473 Collateralized loan obligations 7 721 46,547 1 176 7,824 8 897 54,371 Total securities available-for-sale 16 $ 1,256 $ 86,856 61 $ 7,592 $ 197,238 77 $ 8,848 $ 284,094 Less than 12 months 12 months or more December 31, 2017 in an unrealized loss position in an unrealized loss position Total Number of Unrealized Fair Number of Unrealized Fair Number of Unrealized Fair Securities available-for-sale Securities Losses Value Securities Losses Value Securities Losses Value U.S. Treasuries 1 $ 55 $ 3,947 - $ - $ - 1 $ 55 $ 3,947 U.S. government agencies 2 9 6,550 - - - 2 9 6,550 U.S. government agencies mortgage-backed 4 24 5,501 5 141 4,843 9 165 10,344 States and political subdivisions 13 1,237 45,985 1 27 1,512 14 1,264 47,497 Corporate bonds - - - 1 11 332 1 11 332 Collateralized mortgage obligations 3 31 11,534 8 1,124 40,219 11 1,155 51,753 Asset-backed securities - - - 7 1,913 61,745 7 1,913 61,745 Collateralized loan obligations 3 101 29,313 - - - 3 101 29,313 Total securities available-for-sale 26 $ 1,457 $ 102,830 22 $ 3,216 $ 108,651 48 $ 4,673 $ 211,481 Recognition of other-than-temporary impairment was not necessary in the year ended December 31, 2018, or the year ended December 31, 2017. The changes in fair value related primarily to interest rate fluctuations. The Company’s review of other-than-temporary impairment confirmed no credit quality deterioration. The following table presents net realized gains (losses) on securities available-for-sale for the years ended: Years ended December 31, Securities available-for-sale 2018 2017 2016 Proceeds from sales of securities $ 94,663 $ 232,462 $ 306,400 Gross realized gains on securities 369 2,367 1,675 Gross realized losses on securities (9) (1,893) (3,888) Securities realized gains (losses), net $ 360 $ 474 $ (2,213) Income tax (expense) benefit on net realized gains (losses) $ (100) $ (198) $ 882 Effective tax rate applied 27.8 % 41.8 % 39.9 %

Loans

Loans	12 Months Ended
	Dec. 31, 2018
Loans
Loans	Note 5: Loans Major classifications of loans were as follows: December 31, 2018 December 31, 2017 Commercial $ 314,323 $ 272,851 Leases 78,806 68,325 Real estate - commercial 820,941 750,991 Real estate - construction 108,390 85,162 Real estate - residential 407,068 313,397 HELOC 140,442 112,833 Other 1 14,439 13,383 Total loans, excluding deferred loan costs and PCI loans 1,884,409 1,616,942 Net deferred loan costs 1,653 680 Total loans, excluding PCI loans 1,886,062 1,617,622 PCI loans, net of purchase accounting adjustments 10,965 - Total loans $ 1,897,027 $ 1,617,622 1 The “Other” class includes consumer loans and overdrafts. Total loans reflects growth of $279.4 million for the year ended December 31, 2018. There are no significant concentrations of loans where the customers’ ability to honor loan terms is dependent upon a single economic sector although the real estate related categories listed above represent 77.9% and 78.0% of the portfolio at December 31, 2018, and December 31, 2017, respectively. Aged analysis of past due loans by class of loans as of December 31, 2018, and December 31, 2017, were as follows: Recorded Investment 90 days or 90 Days or Greater Past 30-59 Days 60-89 Days Greater Past Total Past Due and December 31, 2018 Past Due Past Due Due Due Current Nonaccrual Total Loans Accruing Commercial $ 58 $ - $ 352 $ 410 $ 313,913 $ - $ 314,323 $ 361 Leases - - - - 78,806 - 78,806 - Real estate - commercial Owner occupied general purpose 1,768 - 33 1,801 160,892 1,579 164,272 36 Owner occupied special purpose 826 135 - 961 192,426 395 193,782 - Non-owner occupied general purpose 2,832 203 - 3,035 286,115 4,236 293,386 - Non-owner occupied special purpose - - - - 106,036 3,099 109,135 - Retail properties - 620 - 620 45,968 - 46,588 - Farm - - - - 13,778 - 13,778 - Real estate - construction Homebuilder - - - - 5,102 - 5,102 - Land 266 - - 266 2,478 - 2,744 - Commercial speculative - - 350 350 55,060 - 55,410 355 All other - - - - 45,028 106 45,134 - Real estate - residential Investor 801 156 - 957 69,148 353 70,458 - Multi-family 545 - 179 724 195,504 - 196,228 180 Owner occupied 1,241 705 - 1,946 135,360 3,076 140,382 - HELOC 775 - - 775 138,801 866 140,442 - Other 1 53 5 3 61 16,000 31 16,092 3 Total, excluding PCI loans $ 9,165 $ 1,824 $ 917 $ 11,906 $ 1,860,415 $ 13,741 $ 1,886,062 $ 935 PCI loans, net of purchase accounting adjustments 1,452 - - 1,452 7,248 2,265 10,965 - Total $ 10,617 $ 1,824 $ 917 $ 13,358 $ 1,867,663 $ 16,006 $ 1,897,027 $ 935 Recorded Investment 90 days or 90 Days or Greater Past 30-59 Days 60-89 Days Greater Past Total Past Due and December 31, 2017 Past Due Past Due Due Due Current Nonaccrual Total Loans Accruing Commercial $ 995 $ 275 $ - $ 1,270 $ 271,581 $ - $ 272,851 $ - Leases - - - - 68,147 178 68,325 - Real estate - commercial Owner occupied general purpose 1,136 - - 1,136 144,267 455 145,858 - Owner occupied special purpose 226 - - 226 170,546 342 171,114 - Non-owner occupied general purpose - 593 - 593 273,203 1,163 274,959 - Non-owner occupied special purpose - - 248 248 92,923 - 93,171 254 Retail properties - - - - 49,538 1,081 50,619 - Farm - - - - 15,270 - 15,270 - Real estate - construction Homebuilder 129 - - 129 2,221 - 2,350 - Land 1,124 - - 1,124 1,319 - 2,443 - Commercial speculative - - - - 32,028 - 32,028 - All other - - - - 48,140 201 48,341 - Real estate - residential Investor - - - - 55,248 372 55,620 - Multi-family - - - - 125,049 4,723 129,772 - Owner occupied 74 - - 74 123,257 4,674 128,005 - HELOC 491 278 - 769 110,872 1,192 112,833 - Other 1 37 - - 37 14,019 7 14,063 - Total $ 4,212 $ 1,146 $ 248 $ 5,606 $ 1,597,628 $ 14,388 $ 1,617,622 $ 254 1 The “Other” class includes consumer loans, overdrafts and net deferred costs. Credit Quality Indicators: The Company categorizes loans into credit risk categories based on current financial information, overall debt service coverage, comparison against industry averages, historical payment experience, and current economic trends. This analysis includes loans with outstanding balances or commitments greater than $50,000 and excludes homogeneous loans such as home equity lines of credit and residential mortgages. Loans with a classified risk rating are reviewed quarterly regardless of size or loan type. The Company uses the following definitions for classified risk ratings: Special Mention. Loans classified as special mention have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan at some future date. Substandard. Loans classified as substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected. Doubtful. Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable. Credits that are not covered by the definitions above are pass credits, which are not considered to be adversely rated. Credit Quality Indicators by class of loans as of December 31, 2018, and December 31, 2017, were as follows: December 31, 2018 Special Pass Mention Substandard 2 Doubtful Total Commercial $ 305,993 $ 8,193 $ 137 $ - $ 314,323 Leases 78,806 - - - 78,806 Real estate - commercial Owner occupied general purpose 157,334 1,660 5,278 - 164,272 Owner occupied special purpose 186,218 3,429 4,135 - 193,782 Non-owner occupied general purpose 284,818 202 8,366 - 293,386 Non-owner occupied special purpose 104,526 1,510 3,099 - 109,135 Retail Properties 44,805 - 1,783 - 46,588 Farm 11,307 1,249 1,222 - 13,778 Real estate - construction Homebuilder 5,102 - - - 5,102 Land 2,744 - - - 2,744 Commercial speculative 55,410 - - - 55,410 All other 42,524 - 2,610 - 45,134 Real estate - residential Investor 69,242 - 1,216 - 70,458 Multi-family 195,249 - 979 - 196,228 Owner occupied 135,858 - 4,524 - 140,382 HELOC 138,553 - 1,889 - 140,442 Other 1 16,061 - 31 - 16,092 Total, excluding PCI loans $ 1,834,550 $ 16,243 $ 35,269 $ - $ 1,886,062 PCI loans, net of purchase accounting adjustments 907 2,906 7,152 - 10,965 Total $ 1,835,457 $ 19,149 $ 42,421 $ - $ 1,897,027 December 31, 2017 Special Pass Mention Substandard 2 Doubtful Total Commercial $ 270,889 $ 1,962 $ - $ - $ 272,851 Leases 67,500 - 825 - 68,325 Real estate - commercial Owner occupied general purpose 142,843 1,927 1,088 - 145,858 Owner occupied special purpose 169,621 1,152 341 - 171,114 Non-owner occupied general purpose 271,731 2,065 1,163 - 274,959 Non-owner occupied special purpose 89,582 - 3,589 - 93,171 Retail Properties 48,321 1,217 1,081 - 50,619 Farm 11,755 1,029 2,486 - 15,270 Real estate - construction Homebuilder 2,350 - - - 2,350 Land 2,443 - - - 2,443 Commercial speculative 32,028 - - - 32,028 All other 46,913 1,052 376 - 48,341 Real estate - residential Investor 55,172 - 448 - 55,620 Multi-family 125,049 - 4,723 - 129,772 Owner occupied 122,178 561 5,266 - 128,005 HELOC 110,934 - 1,899 - 112,833 Other 1 14,043 - 20 - 14,063 Total $ 1,583,352 $ 10,965 $ 23,305 $ - $ 1,617,622 1 The “Other” class includes consumer, overdrafts and net deferred costs. 2 The substandard credit quality indicator includes both potential problem loans that are currently performing and nonperforming loans. The Company had $448,000 and $1.3 million in consumer mortgage loans in the process of foreclosure as of December 31, 2018 and December 31, 2017, respectively. Impaired loans, which include nonaccrual loans and troubled debt restructurings, by class of loan as of December 31, were as follows: December 31, 2018 December 31, 2017 Unpaid Unpaid Recorded Principal Related Recorded Principal Related Investment Balance Allowance Investment Balance Allowance With no related allowance recorded Commercial $ - $ - $ - $ - $ - $ - Leases - - - 178 213 - Commercial real estate Owner occupied general purpose 1,659 1,782 - 455 495 - Owner occupied special purpose 395 530 - 342 498 - Non-owner occupied general purpose 1,138 1,159 - 1,163 1,538 - Non-owner occupied special purpose - - - - - - Retail properties - - - 1,081 1,177 - Farm - - - - - - Construction Homebuilder - - - - - - Land - - - - - - Commercial speculative - - - - - - All other 49 73 - 201 229 - Residential Investor 353 459 - 372 676 - Multi-family - - - 4,723 4,965 - Owner occupied 3,359 4,882 - 5,208 6,680 - HELOC 884 1,003 - 1,125 1,313 - Other 1 7 7 - 7 8 - Total impaired loans with no recorded allowance 7,844 9,895 - 14,855 17,792 - With an allowance recorded Commercial - - - - - - Leases - - - - - - Commercial real estate Owner occupied general purpose 396 396 3 - - - Owner occupied special purpose - - - - - - Non-owner occupied general purpose 3,098 4,038 97 - - - Non-owner occupied special purpose 3,099 3,575 139 - - - Retail properties - - - - - - Farm - - - - - - Construction Homebuilder - - - - - - Land - - - - - - Commercial speculative - - - - - - All other 57 58 1 - - - Residential Investor 808 808 4 829 829 10 Multi-family - - - - - - Owner occupied 3,676 3,679 46 3,443 3,443 43 HELOC 1,357 1,357 49 985 985 91 Other 1 24 25 13 - - - Total impaired loans with a recorded allowance 12,515 13,936 352 5,257 5,257 144 Total impaired loans $ 20,359 $ 23,831 $ 352 $ 20,112 $ 23,049 $ 144 1 The “Other” class includes consumer loans and overdraft. Average recorded investment and interest income recognized on impaired loans by class of loan for the years ending December 31 were as follows: Years Ended Years Ended Years Ended December 31, 2018 December 31, 2017 December 31, 2016 Average Interest Average Interest Average Interest Recorded Income Recorded Income Recorded Income Investment Recognized Investment Recognized Investment Recognized With no related allowance recorded Commercial $ - $ - $ 120 $ - $ 155 $ - Lease 89 - 272 - 183 - Commercial real estate Owner occupied general purpose 1,057 8 1,168 - 2,098 87 Owner occupied special purpose 369 - 364 - 574 - Non-owner occupied general purpose 1,150 - 1,453 - 1,395 2 Non-owner occupied special purpose - - 507 - 507 - Retail properties 541 - 1,130 - 589 - Farm - - - - 636 - Construction Homebuilder - - - - - - Land - - - - - - Commercial speculative - - 37 - 79 - All other 125 - 204 - 103 - Residential Investor 362 - 1,106 - 1,874 47 Multi-family 2,362 - 2,362 - - - Owner occupied 4,283 39 7,516 44 10,181 158 HELOC 1,005 1 1,804 1 2,608 29 Other 1 7 - 4 - - - Total impaired loans with no recorded allowance 11,350 48 18,047 45 20,982 323 With an allowance recorded Commercial - - - - 2 - Leases - - - - - - Commercial real estate Owner occupied general purpose 198 29 - - - - Owner occupied special purpose - - - - - - Non-owner occupied general purpose 1,549 - 123 - 123 - Non-owner occupied special purpose 1,549 - - - - - Retail properties - - - - - - Farm - - - - - - Construction Homebuilder - - - - - - Land - - - - - - Commercial speculative - - - - - - All other 29 - - - - - Residential Investor 818 43 414 43 - - Multi-family - - - - - - Owner occupied 3,560 150 2,123 123 457 - HELOC 1,171 56 493 35 23 - Other 1 12 - - - - - Total impaired loans with a recorded allowance 8,886 278 3,153 201 605 - Total impaired loans $ 20,236 $ 326 $ 21,200 $ 246 $ 21,587 $ 323 1 The “Other” class includes consumer loans and overdrafts. Troubled debt restructurings (“TDRs”) are loans for which the contractual terms have been modified and both of these conditions exist: (1) there is a concession to the borrower and (2) the borrower is experiencing financial difficulties. Loans are restructured on a case-by-case basis during the loan collection process with modifications generally initiated at the request of the borrower. These modifications may include reduction in interest rates, extension of term, deferrals of principal, and other modifications. The Bank participates in the U.S. Department of the Treasury’s (the “Treasury”) Home Affordable Modification Program (“HAMP”) which gives qualifying homeowners an opportunity to refinance into more affordable monthly payments. The specific allocation of the ALLL on a TDR is determined by either discounting the modified cash flows at the original effective rate of the loan before modification or is based on the underlying collateral value less costs to sell, if repayment of the loan is collateral-dependent. If the resulting amount is less than the recorded book value, the Bank either establishes a valuation allowance (i.e. specific reserve) as a component of the ALLL or charges off the impaired balance if it determines that such amount is a confirmed loss. This method is used consistently for all segments of the portfolio. Loans that were modified during the period are summarized as follows: TDR Modifications Years Ended December 31, 2018 # of Pre-modification Post-modification contracts recorded investment recorded investment Troubled debt restructurings Real estate - commercial Owner occupied general purpose Other 1 1 $ 427 $ 396 Owner occupied special purpose Other 1 1 110 46 Real estate - construction All other Hamp 2 1 58 56 Real estate - residential Owner occupied HAMP 2 4 502 443 Other 1 1 34 29 HELOC HAMP 2 3 117 115 Rate 3 1 24 24 Other 1 9 622 600 Total 21 $ 1,894 $ 1,709 TDR Modifications Years Ended December 31, 2017 # of Pre-modification Post-modification contracts recorded investment recorded investment Troubled debt restructurings Real estate - commercial Other 1 1 $ 97 $ 131 Real estate - residential Owner occupied HAMP 2 184 189 Other 1 41 42 Revolving and junior liens HAMP 2 49 49 Other 1 6 319 350 Total 11 $ 690 $ 761 1 Other: Change of terms from bankruptcy court 2 HAMP: Home Affordable Modification Program 3 Rate: Refers to interest rate reduction TDRs are classified as being in default on a case-by-case basis when they fail to be in compliance with the modified terms. There were no TDRs that defaulted during year 2018 and 2017. The Bank had no commitments to borrowers whose loans were classified as impaired at December 31, 2018. The following table details the accretable discount on all of the Company’s purchased loans, both non-PCI loans and PCI loans as of December 31, 2018: Accretable Discount - Non-PCI Loans Accretable Discount - PCI Loans Non-Accretable Discount - PCI Loans Total Beginning balance, January 1, 2018 $ 835 $ - $ - $ 835 Purchases 3,182 1,551 6,536 11,269 Accretion (1,777) (424) (434) (2,635) Transfer 1 (373) (28) (133) (534) Ending balance, December 31, 2018 $ 1,867 $ 1,099 $ 5,969 $ 8,935 1 Transfer was due to loans moved to OREO. Loans to principal officers, directors, and their affiliates, which are made in the ordinary course of business, were as follows at December 31: 2018 2017 Beginning balance $ 1,524 $ 1,703 New loans 89 20 Repayments and other reductions (196) (199) Change in related party status - - Ending balance $ 1,417 $ 1,524 No loans to principal officers, directors, and their affiliates were past due greater than 90 days at either December 31, 2018, or December 31, 2017.

Allowance for Loan Losses

Allowance for Loan Losses	12 Months Ended
	Dec. 31, 2018
Allowance for Loan Losses
Allowance for Loan Losses	Note 6: Allowance for Loan and Lease losses Changes in the ALLL by segment of loans based on method of impairment for the year ended December 31, 2018, were as follows: Real Estate Real Estate Real Estate Allowance for loan and lease losses: Commercial Leases Commercial Construction Residential HELOC Other 1 Total Beginning balance $ 2,453 $ 692 $ 9,522 $ 923 $ 1,846 $ 1,446 $ 579 $ 17,461 Charge-offs 41 13 1,548 (16) (45) 147 409 2,097 Recoveries 157 - 447 35 1,146 364 265 2,414 Provision (Release) 263 55 2,049 (5) (1,106) (214) 186 1,228 Ending balance $ 2,832 $ 734 $ 10,470 $ 969 $ 1,931 $ 1,449 $ 621 $ 19,006 Ending balance: Individually evaluated for impairment $ - $ - $ 239 $ 1 $ 50 $ 49 $ 13 $ 352 Ending balance: Collectively evaluated for impairment 2,832 734 10,231 968 1,881 1,400 608 18,654 Ending balance: Acquired and accounted for ASC 310-30 - - - - - - - - Total ending allowance balance $ 2,832 $ 734 $ 10,470 $ 969 $ 1,931 $ 1,449 $ 621 $ 19,006 Loans: Ending balance: Individually evaluated for Impairment $ - $ - $ 9,785 $ 106 $ 8,196 $ 2,241 $ 31 $ 20,359 Ending balance: Collectively evaluated for impairment 314,323 78,806 811,156 108,284 398,872 138,201 16,061 1,865,703 Ending balance: Acquired and accounted for ASC 310-30 - - 4,182 745 6,038 - - 10,965 Total ending loans balance $ 314,323 $ 78,806 $ 825,123 $ 109,135 $ 413,106 $ 140,442 $ 16,092 $ 1,897,027 Changes in the ALLL by segment of loans based on method of impairment for the year ended December 31, 2017, were as follows: Real Estate Real Estate Real Estate Allowance for loan and lease losses: Commercial Leases Commercial Construction Residential HELOC Other 1 Total Beginning balance $ 1,629 $ 633 $ 9,547 $ 389 $ 2,178 $ 1,331 $ 451 $ 16,158 Charge-offs 25 215 309 23 1,347 386 1 2,306 Recoveries 30 - 161 377 980 243 18 1,809 Provision (Release) 819 274 123 180 35 258 111 1,800 Ending balance $ 2,453 $ 692 $ 9,522 $ 923 $ 1,846 $ 1,446 $ 579 $ 17,461 Ending balance: Individually evaluated for impairment $ - $ - $ - $ - $ 53 $ 91 $ - $ 144 Ending balance: Collectively evaluated for impairment 2,453 692 9,522 923 1,793 1,355 579 17,317 Total ending allowance balance $ 2,453 $ 692 $ 9,522 $ 923 $ 1,846 $ 1,446 $ 579 $ 17,461 Loans: Ending balance: Individually evaluated for impairment $ - $ 178 $ 3,041 $ 201 $ 14,575 $ 2,110 $ 7 $ 20,112 Ending balance: Collectively evaluated for impairment 272,851 68,147 747,950 84,961 298,822 110,723 14,056 1,597,510 Total ending loan balance $ 272,851 $ 68,325 $ 750,991 $ 85,162 $ 313,397 $ 112,833 $ 14,063 $ 1,617,622 Changes in the ALLL by segment of loans based on method of impairment for the year ended December 31, 2016, were as follows: Real Estate Real Estate Real Estate Allowance for loan and lease losses: Commercial Leases Commercial Construction Residential HELOC Other 1 Total Beginning balance $ 1,463 $ 633 $ 9,013 $ 265 $ 724 $ 2,050 $ 2,075 $ 16,223 Charge-offs 95 23 1,633 23 450 622 344 3,190 Recoveries 32 5 640 96 486 845 271 2,375 Provision (Release) 229 18 1,527 51 1,418 (942) (1,551) 750 Ending balance $ 1,629 $ 633 $ 9,547 $ 389 $ 2,178 $ 1,331 $ 451 $ 16,158 Ending balance: Individually evaluated for impairment $ - $ - $ 246 $ - $ 803 $ - $ - $ 1,049 Ending balance: Collectively evaluated for impairment 1,629 633 9,301 389 1,375 1,331 451 15,109 Total ending allowance balance $ 1,629 $ 633 $ 9,547 $ 389 $ 2,178 $ 1,331 $ 451 $ 16,158 Loans: Ending balance: Individually evaluated for impairment $ 240 $ 366 $ 6,448 $ 281 $ 12,468 $ 2,484 $ - $ 22,287 Ending balance: Collectively evaluated for impairment 227,873 55,085 729,799 64,439 263,757 99,142 16,427 1,456,522 Total ending loan balance $ 228,113 $ 55,451 $ 736,247 $ 64,720 $ 276,225 $ 101,626 $ 16,427 $ 1,478,809 1 The “Other” class includes consumer loans, overdrafts and net deferred costs.

Other Real Estate Owned

Other Real Estate Owned	12 Months Ended
	Dec. 31, 2018
Other Real Estate Owned
Other Real Estate Owned	Note 7: Other Real Estate Owned Details related to the activity in the other real estate owned (“OREO”) portfolio, net of valuation reserve, for the periods presented are itemized in the following table. Years Ended December 31, Other real estate owned 2018 2017 2016 Balance at beginning of period $ 8,371 $ 11,916 $ 19,141 Property additions, net of acquisition adjustments 3,316 3,796 1,785 Property improvements 59 - 16 Less: Proceeds from property disposals, net of participation purchase and of gains/losses 3,990 5,633 7,456 Period valuation adjustments 581 1,708 1,570 Balance at end of period $ 7,175 $ 8,371 $ 11,916 Activity in the valuation allowance was as follows: Years Ended December 31, 2018 2017 2016 Balance at beginning of period $ 8,208 $ 9,982 $ 14,127 Provision for unrealized losses 581 1,708 1,570 Reductions taken on sales (762) (3,482) (5,867) Other adjustments - - 152 Balance at end of period $ 8,027 $ 8,208 $ 9,982 Expenses related to OREO, net of lease revenue includes: Years Ended December 31, 2018 2017 2016 Gain on sales, net $ (792) $ (474) $ (374) Provision for unrealized losses 581 1,708 1,570 Operating expenses 649 1,227 1,765 Less: Lease revenue 42 296 218 Net OREO expense $ 396 $ 2,165 $ 2,743

Premises and Equipment

Premises and Equipment	12 Months Ended
	Dec. 31, 2018
Premises and Equipment
Premises and Equipment	Note 8: Premises and Equipment Premises and equipment at December 31 were as follows: 2018 2017 Accumulated Accumulated Depreciation/ Net Book Depreciation/ Net Book Cost Amortization Value Cost Amortization Value Land $ 18,501 $ - $ 18,501 $ 16,124 $ - $ 16,124 Buildings 43,376 23,913 19,463 41,499 22,935 18,564 Leasehold improvements 710 246 464 156 144 12 Furniture and equipment 45,258 41,247 4,011 42,910 39,982 2,928 Total Premises and Equipment $ 107,845 $ 65,406 $ 42,439 $ 100,689 $ 63,061 $ 37,628

Deposits

Deposits	12 Months Ended
	Dec. 31, 2018
Deposits
Deposits	Note 9: Deposits Major classifications of deposits at December 31 were as follows: December 31, 2018 December 31, 2017 Noninterest bearing demand $ 618,830 $ 572,404 Savings 304,400 262,220 NOW accounts 425,878 429,448 Money market accounts 310,390 276,082 Certificates of deposit of less than $100,000 230,781 216,493 Certificates of deposit of $100,000 through $250,000 159,953 122,489 Certificates of deposit of more than $250,000 66,441 43,789 Total deposits $ 2,116,673 $ 1,922,925 Growth in total deposits stemmed from the ABC Bank acquisition; the Company assumed $248.5 million of additional deposits, which consisted of time deposits of $99.0 million, savings, NOW, and money markets of $91.5 million, and noninterest bearing demand deposits of $58.0 million. The Company had $30.4 million in brokered certificates of deposit as of December 31, 2018. The Company had $18.8 million in brokered certificates of deposit as of December 31, 2017. Deposits held by senior officers and directors, including their related interests, totaled $1.6 million and $2.6 million as of December 31, 2018 and 2017. At December 31, 2018, scheduled maturities of time deposits were as follows: 2019 $ 276,349 2020 124,857 2021 38,036 2022 8,206 2023 9,727 Total time deposits $ 457,175

Borrowings

Borrowings	12 Months Ended
	Dec. 31, 2018
Borrowings
Borrowings	Note 10: Borrowings The following table is a summary of borrowings as of December 31, 2018, and December 31, 2017. Junior subordinated debentures are discussed in detail in Note 11: December 31, 2018 December 31, 2017 Securities sold under repurchase agreements $ 46,632 $ 29,918 Other short-term borrowings 1 149,500 115,000 Junior subordinated debentures 2 57,686 57,639 Senior notes 44,158 44,058 Notes payable and other borrowings 15,379 - Total borrowings $ 313,355 $ 246,615 1 Includes short-term FHLBC advances and the outstanding portion of an operating line of credit. 2 See Note 11: Junior Subordinated Debentures, below. The Company enters into deposit sweep transactions where the transaction amounts are secured by pledged securities. These transactions consistently mature within 1 to 90 days from the transaction date and are governed by sweep repurchase agreements. All sweep repurchase agreements are treated as financings secured by U.S. government agencies, collateralized mortgage obligations, mortgage-backed securities and/or highly-rated issues of State and political subdivisions, and had a carrying amount of $46.6 million at December 31, 2018, and $29.9 million at December 31, 2017. The fair value of the pledged collateral was $72.8 million and $40.0 million at December 31, 2018 and December 31, 2017, respectively. At December 31, 2018, there were no customers with secured balances exceeding 10% of stockholders’ equity. Total FHLBC advances are generally limited to the lower of 35% of total assets and the amount of acceptable collateral adjusted for applicable funding percentages as determined by the FHLBC. As of December 31, 2018, the Bank primarily had outstanding advances in the amount of $149.5 million with $130.0 million at an interest rate of 2.52% and $15.5 million at a weighted average interest rate at 1.95%. As of December 31, 2017, the Bank had outstanding advances in the amount of $115.0 million with $110.0 million at an interest rate of 1.42% and $5.0 million at an interest rate of 1.44%. As of December 31, 2018, FHLBC stock owned by the Bank was valued at $7.2 million, the fair value of securities pledged to the FHLBC was $77.6 million, and the principal balance of loans pledged was $306.2 million. The Bank also assumed $23.4 million of long-term FHLBC advances with the ABC acquisition. At December 31, 2018, these advances have a total outstanding balance of $15.4 million and are scheduled to mature over the next 7.25 years with interest rates ranging between 1.40% to 2.83%. Based on the total amount of securities and loans pledged, the Bank had total borrowing capacity of $304.8 million. Adjusting for the outstanding advances and letters of credit, the Bank had a remaining funding availability of $69.6 million on December 31, 2018. The Company also has $44.2 million of senior notes outstanding, net of deferred issuance costs, as of December 31, 2018 and $44.1 million as of December 31, 2017. The senior notes mature in ten years, and terms include interest payable semiannually at 5.75% for five years. Beginning December 2021, the senior debt will pay interest at a floating rate, with interest payable quarterly at three month LIBOR plus 385 basis points. The notes are redeemable, in whole or in part, at the option of the Company, beginning with the interest payment date on December 31, 2021, and on any floating rate interest payment date thereafter, at a redemption price equal to 100% of the principal amount of the notes plus accrued and unpaid interest. As of December 31, 2018 and 2017, unamortized debt issuance costs related to the senior notes were $842,000 and $942,000, respectively, and are included as a reduction of the balance of the senior notes on the Consolidated Balance Sheet. These deferred issuance costs will be amortized to interest expense over the ten year term of the notes and included in the Consolidated Statements of Income. Scheduled maturities and weighted average rates of borrowings for the years ended December 31 were as follows: 2018 2017 Weighted Weighted Average Average Balance Rate Balance Rate 2018 N/A N/A $ 144,918 0.86 % 2019 $ 196,132 1.78 % - - 2020 8,500 2.05 - - 2021 - - - - 2022 - - - - 2023 - - - - Thereafter 108,723 6.07 101,697 6.01 Total borrowings $ 313,355 3.28 % $ 246,615 2.98 %

Junior Subordinated Debentures

Junior Subordinated Debentures	12 Months Ended
	Dec. 31, 2018
Junior Subordinated Debentures.
Junior Subordinated Debentures	Note 11: Junior Subordinated Debentures The Company completed the sale of $27.5 million of cumulative trust preferred securities by its unconsolidated subsidiary, Old Second Capital Trust I in June 2003. An additional $4.1 million of cumulative trust preferred securities were sold in July 2003. The costs associated with the issuance of the cumulative trust preferred securities are being amortized over 30 years. The trust preferred securities may remain outstanding for a 30‑year term but, subject to regulatory approval, can be called in whole or in part by the Company after June 30, 2008, and can be exercised by the Company from time to time thereafter. When not in deferral, distributions on the securities are payable quarterly at an annual rate of 7.80%. The Company issued a new $32.6 million subordinated debenture to Old Second Capital Trust I in return for the aggregate net proceeds of this trust preferred offering. The interest rate and payment frequency on the debenture are equivalent to the cash distribution basis on the trust preferred securities. The Company sold an additional $25.0 million of cumulative trust preferred securities through a private placement completed by an additional, unconsolidated subsidiary, Old Second Capital Trust II, in April 2007. These trust preferred securities also mature in 30 years, but subject to the aforementioned regulatory approval, can be called in whole or in part on a quarterly basis commencing June 15, 2017. The quarterly cash distributions on the securities are fixed at 6.77% through June 15, 2017, and float at 150 basis points over three-month LIBOR thereafter. The Trust II issuance converted from fixed to float rate at three month LIBOR plus 150 basis points on June 16, 2017; as of December 31, 2018, the rate effective for the Trust II issuance was 4.37%. Upon conversion to a floating rate, a cash flow hedge was initiated which resulted in the total interest rate period on the debt of 4.30% as of December 31, 2017, compared to the rate paid prior to June 15, 2017 of 6.77%. The Company issued a new $25.8 million subordinated debenture to the Old Second Capital Trust II in return for the aggregate net proceeds of this trust preferred offering. The interest rate and payment frequency on the debenture are equivalent to the cash distribution basis on the trust preferred securities. Both of the debentures issued by the Company are disclosed on the Consolidated Balance Sheet as junior subordinated debentures and the related interest expense for each issuance is included in the Consolidated Statements of Income. As of December 31, 2018 and 2017, unamortized debt issuance costs related to the junior subordinated debentures were $692,000 and $739,000 respectively, and are included as a reduction to the balance of the junior subordinated debentures on the Consolidated Balance Sheet. Under the terms of the subordinated debentures issued to each of Old Second Capital Trust I and II, the Company is allowed to defer payments of interest for 20 quarterly periods without default or penalty, but such amounts continue to accrue. Also during a deferral period, the Company generally may not pay cash dividends on or repurchase its common stock or preferred stock. As of December 31, 2018, the Company is current on the payments due on these securities.

Income Taxes

Income Taxes	12 Months Ended
	Dec. 31, 2018
Income Taxes
Income Taxes	Note 12: Income Taxes Income tax expense for years ending December 31 were as follows: December 31, 2018 December 31, 2017 December 31, 2016 Current federal $ - $ (2,407) $ 399 Current state 84 - - Deferred federal 6,226 11,724 6,824 Deferred state 3,614 372 1,597 Expense due to enactment of federal tax reform - 9,475 - Total income tax expenses $ 9,924 $ 19,164 $ 8,820 The following were the components of the deferred tax assets and liabilities as of December 31: December 31, 2018 December 31, 2017 Allowance for loan and lease losses $ 5,803 $ 5,377 Deferred compensation 665 650 Amortization of core deposit intangible - 827 Goodwill amortization/impairment 4,698 6,087 Stock based compensation 1,377 866 Business combination adjustments 2,532 - OREO write-downs 2,337 2,385 Federal net operating loss (“NOL”) carryforward 2,199 7,240 State net operating loss (“NOL”) carryforward 4,034 7,020 Other assets 1,401 1,017 Total deferred tax assets 25,046 31,469 Accumulated depreciation on premises and equipment (443) (384) Mortgage servicing rights (2,210) (2,086) Amortization of core deposit intangible (130) - State tax benefits (1,839) (2,389) Other liabilities (741) (545) Total deferred tax liabilities (5,363) (5,404) Net deferred tax asset before adjustments related to other comprehensive income 19,683 26,065 Tax effect of adjustments related to other comprehensive income (loss) 1,597 (709) Net deferred tax asset $ 21,280 $ 25,356 On December 22, 2017, H.R.1, commonly known as the Tax Cuts and Jobs Act (the “Act”), was signed into law. Among other things, the Act reduces the corporate federal tax rate from 35% to 21% effective January 1, 2018. As a result the Company was required to remeasure, through income tax expense, deferred tax assets and liabilities using the enacted rate at which these items are expected to recover or settle. The re-measurement of the Company’s net deferred tax asset resulted in additional income tax expense of approximately $9.5 million for the year ended December 31, 2017. The Company also re-measured the net deferred tax asset as a result of the Illinois income tax increase effective as of July 1, 2017. This resulted in a tax benefit of approximately $1.6 million for the year ended December 31, 2017. At December 31, 2018, the Company had a $7.6 million federal net operating loss carryforward that is expected to expire in 2031 thru 2033. The Company had a $39.9 million state net operating loss carryforward of which $39.7 million expires in 2025, and the rest expires starting in 2026. In addition, the Company had a $2.6 million alternative minimum tax credit carryforward which does not expire and is carried as a tax receivable since, under the new federal law; the Company expects to recover the entire amount by 2022 via refund or reduction of regular tax liability. The components of the provision for deferred income tax expense for the years ending December 31 were as follows: December 31, 2018 December 31, 2017 December 31, 2016 Provision for loan and lease losses $ (426) $ 1,680 $ 42 Deferred Compensation (15) 85 (45) Amortization of core deposit intangible 957 574 228 Stock based compensation (511) 80 (132) Business combination adjustments 927 - - OREO write-downs 48 2,725 1,807 Federal net operating loss carryforward 5,041 12,122 4,743 State net operating loss carryforward 2,986 715 1,011 Deferred tax credit - 2,058 (309) Depreciation 59 (297) 80 Mortgage servicing rights 124 (674) 276 Goodwill amortization/impairment 1,389 4,040 1,496 State tax benefits (550) (1,738) (559) Other, net (189) 201 (217) Total deferred tax expense $ 9,840 $ 21,571 $ 8,421 Effective tax rates differ from federal statutory rates applied to financial statement income for the years ended December 31 due to the following: December 31, 2018 December 31, 2017 December 31, 2016 Tax at statutory federal income tax rate $ 9,227 $ 11,817 $ 8,577 Nontaxable interest income, net of disallowed interest deduction (1,600) (1,976) (347) BOLI income (422) (501) (449) State income taxes, net of federal benefit 2,927 1,775 1,148 Stock based compensation (305) - - Impact of Federal tax rate change - 9,475 - Impact of Illinois tax rate change - (1,566) - Other, net 97 140 (109) Total tax at effective tax rate $ 9,924 $ 19,164 $ 8,820 The Company evaluated positive and negative evidence in order to determine if it was more likely than not that the deferred tax asset would be recovered through future income. Significant positive evidence evaluated included recent and projected earnings, significantly improved asset quality and an improved capital position. No negative evidence was noted.

Equity Compensation Plans

Equity Compensation Plans	12 Months Ended
	Dec. 31, 2018
Equity Compensation Plans
Equity Compensation Plans	Note 13: Equity Compensation Plans The Company’s 2008 Equity Incentive Plan was in effect for years prior to 2014, and authorized the issuance of the Company’s common stock, which included share grants in the form of qualified stock options, non-qualified stock options, restricted stock, restricted stock units and stock appreciation rights. Under the 2008 Equity Incentive Plan, stock based awards were eligible to be granted to selected directors, officers or employees at the discretion of the Board of Directors. All stock options granted under the 2008 Incentive Plan have vested; however, all such options issued prior to 2009 have expired as of December 31, 2017. The Company granted 16,500 stock options in 2009 under the 2008 Equity Incentive Plan, 4,500 of which are vested and outstanding as of December 31, 2018. The stock option awards had a vesting period of three years, and a term of ten years. No other stock options were granted in 2009 through 2018. There were 4,500 stock options exercised during 2018, no stock options exercised during 2017 and 1,500 stock options exercised during 2016. At December 31, 2018, the Company had no unrecognized compensation cost related to unvested stock options as all stock options have fully vested. A summary of stock option activity in the Plans for the years ending December 31, 2018, is as follows: Weighted- Weighted Average Average Remaining Exercise Price Contractual Aggregate Shares per Share Term (years) Intrinsic Value Beginning outstanding 9,000 $ 7.49 1.1 $ 55 Canceled - - - - Exercised (4,500) 7.49 - (27) Expired - - - - Ending outstanding 4,500 $ 7.49 0.1 $ 25 Exercisable at end of period 4,500 $ 7.49 0.1 $ 25 A summary of stock option activity as of each year is as follows: 2018 2017 2016 Intrinsic value of options exercised $ 27 $ - $ 3 Cash received from option exercises 33 - 11 Tax benefit realized from option exercises 5 - - Weighted average fair value of options granted - - - There are stock-based awards outstanding under the Company’s 2008 Equity Incentive Plan (the “2008 Plan”) and the Company’s 2014 Equity Incentive Plan, as amended (the “2014 Plan,” and together with the 2008 Plan, the “Plans”). The 2014 Plan was approved at the 2014 annual meeting of stockholders; a maximum of 375,000 shares were authorized to be issued under this plan. Following approval of the 2014 Plan, no further awards will be granted under the 2008 Plan or any other Company equity compensation plan. At the May 2016 annual stockholders meeting, an amendment to the 2014 Plan authorized an additional 600,000 shares to be issued, which resulted in a total of 975,000 shares authorized for issuance under this plan. The Plans authorize the granting of qualified stock options, non-qualified stock options, restricted stock, restricted stock units, and stock appreciation rights. Awards may be granted to selected directors and officers or employees under the 2014 Plan at the discretion of the Compensation Committee of the Company’s Board of Directors. As of December 31, 2018, 169,791 shares remained available for issuance under the 2014 Plan. Total compensation cost that has been charged for the 2014 Plan was $2.3 million, $1.2 million and $657,000 for the years ending December 31, 2018, 2017 and 2016 respectively. Under the 2014 Plan, upon a change in control of the Company, if (i) the 2014 Plan is not an obligation of the successor entity following the change in control, or (ii) the 2014 Plan is an obligation of the successor entity following the change in control and the participant incurs an involuntary termination, then the stock options, stock appreciation rights, stock awards and cash incentive awards under the 2014 Plan will become fully exercisable and vested. Performance-based awards generally will vest based upon the level of achievement of the applicable performance measures through the change in control. Restricted stock awards under the 2014 Plan generally entitle holders to voting and dividend rights upon grant and are subject to forfeiture until certain restrictions have lapsed including employment for a specific period. Restricted stock units under the Plans are also subject to forfeiture until certain restrictions have lapsed including employment for a specific period but do not entitle holders to voting rights until the restricted period ends and shares are transferred in connection with the units. There were 254,281 restricted awards issued during the year ending December 31, 2018. There were 161,500 restricted awards issued during the year ending December 31, 2017. Compensation expense is recognized over the vesting period of the restricted award based on the market value of the award on the issue date. A summary of changes in the Company’s unvested restricted awards for the years ending December 31, 2018, is as follows: December 31, 2018 Weighted Restricted Average Stock Shares Grant Date and Units Fair Value Unvested at January 1 465,000 $ 7.79 Granted 254,281 13.98 Vested (167,000) 5.60 Forfeited - - Unvested at December 31 552,281 $ 11.31 Total unrecognized compensation cost of restricted awards was $3.0 million as of December 31, 2018, which is expected to be recognized over a weighted-average period of 1.80 years.

Earnings Per Share

Earnings Per Share	12 Months Ended
	Dec. 31, 2018
Earnings Per Share
Earnings Per Share	Note 14: Earnings Per Share The earnings per share, both basic and diluted, are included below as of December 31 (in thousands except for share data): 2018 2017 2016 Basic earnings per share: Weighted-average common shares outstanding 29,728,308 29,600,702 29,532,510 Net income $ 34,012 $ 15,138 $ 15,684 Basic earnings per share $ 1.14 $ 0.51 $ 0.53 Diluted earnings per share: Weighted-average common shares outstanding 29,728,308 29,600,702 29,532,510 Dilutive effect of unvested restricted awards 1 532,692 435,142 305,678 Dilutive effect of stock options and warrants 47,935 2,573 743 Diluted average common shares outstanding 30,308,935 30,038,417 Net Income $ 34,012 $ 15,138 $ 15,684 Diluted earnings per share $ 1.12 $ 0.50 $ 0.53 Number of antidilutive options and warrants excluded from the diluted earnings per share calculation - 815,339 900,839 1 Includes the common stock equivalents for restricted share rights that are dilutive. The above earnings per share calculation did not include a warrant for 815,339 shares of common stock that was outstanding as of December 31, 2017 and 2016, because the warrant was anti-dilutive at an exercise price of $13.43. Of note, the warrant was sold at auction by the Treasury in June 2013 to a third party investor. On January 16, 2019, the warrant was exercised; see further disclosures in Note 1: Subsequent Events, above.

Commitments

Commitments	12 Months Ended
	Dec. 31, 2018
Commitments
Commitments	Note 15: Commitments In the normal course of business, there are outstanding commitments that are not reflected in the Consolidated Financial Statements. Commitments include financial instruments that involve, to varying degrees, elements of credit, interest rate, and liquidity risk. In management’s opinion, these do not represent unusual risks and management does not anticipate significant losses as a result of these transactions. The Company uses the same credit policies in making commitments and conditional obligations for borrowers as it does for on-balance sheet instruments. The following table is a summary of financial instrument commitments: December 31, 2018 December 31, 2017 Fixed Variable Total Fixed Variable Total Letters of credit: Borrower: Financial standby $ 327 $ 7,158 $ 7,485 $ 177 $ 3,770 $ 3,947 Commercial standby - 397 397 - 354 354 Performance standby 532 6,381 6,913 241 7,594 7,835 859 13,936 14,795 418 11,718 12,136 Non-borrower: Performance standby - 67 67 - 142 142 Total letters of credit $ 859 $ 14,003 $ 14,862 $ 418 $ 11,860 $ 12,278 Unused loan commitments: $ 89,303 $ 297,785 $ 387,088 $ 82,942 $ 260,061 $ 343,003 The Bank occupies facilities under long-term operating leases, some of which include provisions for future rent increases. In addition, the Company leases space at sites that house automatic teller machines (ATMs). The Company also receives rental income on certain leased properties. As of December 31, 2018, aggregate future minimum rental income to be received under noncancelable leases totaled $123,000. Total facility net operating lease expense or revenue recorded under all operating leases was a net expense of $180,000 and $64,000 in 2018 and 2017, respectively, and net revenue of $25,000 in 2016. Total ATM lease expense, including the costs related to servicing those ATM’s, was $979,000, $679,000 and $685,000 in 2018, 2017 and 2016, respectively; $208,000 of the 2018 expense was attributable to the acquisition of ABC Bank. The following table below is the estimated aggregate minimum annual rental commitments at December 31, 2018: 2019 2020 2021 2022 2023 2024 Rental commitment $ 534 $ 478 $ 482 $ 368 $ 336 $ 346 Legal proceedings The Company and its subsidiaries, from time to time, pursue collection suits and other actions that arise in the ordinary course of business against their borrowers and are defendants in legal actions arising from normal business activities. Management, after consultation with legal counsel, believes that the ultimate liabilities, if any, resulting from these actions will not have a material adverse effect on the financial position of the Bank or on the consolidated financial position of the Company based on all known information at this time.

Regulatory & Capital Matters

Regulatory & Capital Matters	12 Months Ended
	Dec. 31, 2018
Regulatory & Capital Matters
Regulatory & Capital Matters	Note 16: Regulatory & Capital Matters The Bank is subject to the risk-based capital regulatory guidelines, which include the methodology for calculating the risk-weighted Bank assets, developed by the Office of the Comptroller of the Currency (the “OCC”) and the other bank regulatory agencies. In connection with the current economic environment, the Bank’s current level of nonperforming assets and the risk-based capital guidelines, the Bank’s board of directors’ guidelines are for the Bank to maintain a Tier 1 leverage capital ratio at or above eight percent (8%) and a total risk-based capital ratio at or above twelve percent (12%). The Bank currently exceeds those thresholds. Bank holding companies are required to maintain minimum levels of capital in accordance with capital guidelines implemented by the Board of Governors of the Federal Reserve System. The general bank and holding company capital adequacy guidelines in force as of the periods reported are shown in the accompanying table, as are the capital ratios of the Company and the Bank, as of December 31, 2018, and December 31, 2017. In July 2013, the U.S. federal banking authorities issued final rules (the “Basel III Rules”) establishing more stringent regulatory capital requirements for U.S. banking institutions, which went into effect on January 1, 2015. A detailed discussion of the Basel III Rules is included in Part I, Item 1 of the under the heading “Supervision and Regulation.” The Company and the Bank are subject to regulatory capital requirements administered by federal banking agencies. The capital ratios below are calculated pursuant to the capital requirements in effect for the periods reported below. Capital levels and industry defined regulatory minimum required levels: Minimum Capital To Be Well Capitalized Under Adequacy with Capital Prompt Corrective Actual Conservation Buffer if applicable 1 Action Provisions 2 Amount Ratio Amount Ratio Amount Ratio December 31, 2018 Common equity tier 1 capital to risk weighted assets Consolidated $ 207,597 9.29 % $ 142,444 6.375 % N/A N/A Old Second Bank 295,599 13.29 141,791 6.375 $ 144,571 6.50 % Total capital to risk weighted assets Consolidated 282,126 12.63 220,648 9.875 N/A N/A Old Second Bank 314,600 14.14 219,637 9.875 222,417 10.00 Tier 1 capital to risk weighted assets Consolidated 263,125 11.78 175,960 7.875 N/A N/A Old Second Bank 295,599 13.29 175,153 7.875 177,934 8.00 Tier 1 capital to average assets Consolidated 263,125 10.08 104,415 4.00 N/A N/A Old Second Bank 295,599 11.36 104,084 4.00 130,105 5.00 December 31, 2017 Common equity tier 1 capital to risk weighted assets Consolidated $ 179,853 9.25 % $ 111,801 5.750 % N/A N/A Old Second Bank 249,417 12.88 111,347 5.750 $ 125,870 6.50 % Total capital to risk weighted assets Consolidated 251,383 12.93 179,837 9.250 N/A N/A Old Second Bank 266,873 13.78 179,142 9.250 193,667 10.00 Tier 1 capital to risk weighted assets Consolidated 233,927 12.03 140,978 7.250 N/A N/A Old Second Bank 249,417 12.88 140,394 7.250 154,917 8.00 Tier 1 capital to average assets Consolidated 233,927 10.08 92,828 4.00 N/A N/A Old Second Bank 249,417 10.79 92,462 4.00 115,578 5.00 1 As of December 31, 2018, amounts shown are inclusive of a capital conservation buffer of 1.875% as compared to December 31, 2017, of 1.25%. 2 The Bank exceeded the general minimum regulatory requirements to be considered “well capitalized” . Dividend Restrictions In addition to the above requirements, banking regulations and capital guidelines generally limit the amount of dividends that may be paid by a Bank without prior regulatory approval. Under these regulations, the amount of dividends that may be paid in any calendar year is limited to the current year’s profits, combined with the retained profit of the previous two years, subject to the capital requirements described above. Pursuant to the Basel III rules that came into effect January 1, 2015, the Bank must keep a buffer of 0.625% in 2016, 1.25% in 2017, 1.875% in 2018, and 2.5% in 2019 and thereafter of minimum capital requirements in order to avoid additional limitations on capital distributions.

Mortgage Banking Derivatives

Mortgage Banking Derivatives	12 Months Ended
	Dec. 31, 2018
Mortgage Banking Derivatives
Mortgage Banking Derivatives
Mortgage Banking Derivatives	Note 17: Mortgage Banking Derivatives Commitments to fund certain mortgage loans (interest rate locks) to be sold into the secondary market and forward commitments for the future delivery of mortgage loans to third party investors are considered derivatives. It is the Company’s practice to sell mortgage-backed securities (“MBS”) contracts for the future delivery to economically hedge the effect of changes in interest rates resulting from its commitments to fund the loans. These contracts are also derivatives and collectively with the forward commitments for the future delivery of mortgage loans are considered forward contracts. These mortgage banking derivatives are not designated in hedge relationships using the accepted accounting for derivative instruments and hedging activities at December 31: 2018 2017 Forward contracts: Notional amount $ 9,315 $ 16,500 Fair value (50) 3 Rate lock commitments: Notional amount $ 8,815 $ 10,478 Fair value 209 235 Fair values were estimated based on changes in mortgage interest rates from the date of the commitments. The Company sold $133.9 million in loans to investors receiving proceeds of $137.6 million and resulting in a gain on sale of $3.8 million for the year ended December 31, 2018. Sales to investors included $93.9 million, or 69.4%, to FNMA and $14.8 million, or 11.0%,to FHLMC for the year ended December 31, 2018. No other individual investor was sold more than 10% of the total loans sold.

Fair Value Measurements

Fair Value Measurements	12 Months Ended
	Dec. 31, 2018
Fair Value Measurements
Fair Value Measurements	Note 18: Fair Value Measurements Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The fair value hierarchy established by the Company also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Three levels of inputs that may be used to measure fair value are: Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets that the Company has the ability to access as of the measurement date. Level 2: Significant observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, and other inputs that are observable or can be corroborated by observable market data. Level 3: Significant unobservable inputs that reflect a company’s own view about the assumptions that market participants would use in pricing an asset or liability. Transfers between levels are deemed to have occurred at the end of the reporting period. At year end December 31, 2018, the Company had no securities transferred from Level 2 to Level 3. The majority of securities are valued by external pricing services or dealer market participants and are classified in Level 2 of the fair value hierarchy. Both market and income valuation approaches are utilized. Quarterly, the Company evaluates the methodologies used by the external pricing services or dealer market participants to develop the fair values to determine whether the results of the valuations are representative of an exit price in the Company’s principal markets and an appropriate representation of fair value. The Company uses the following methods and significant assumptions to estimate fair value: · Government-sponsored agency debt securities are primarily priced using available market information through processes such as benchmark spreads, market valuations of like securities, like securities groupings and matrix pricing. · Other government-sponsored agency securities, MBS and some of the actively traded real estate mortgage investment conduits and collateralized mortgage obligations are priced using available market information including benchmark yields, prepayment speeds, spreads, volatility of similar securities and trade date. · State and political subdivisions are largely grouped by characteristics (e.g., geographical data and source of revenue in trade dissemination systems). Because some securities are not traded daily and due to other grouping limitations, active market quotes are often obtained using benchmarking for like securities. · Beginning March 31, 2015, auction rate asset backed securities are priced using market spreads, cash flows, prepayment speeds, and loss analytics. This process supports the transfer to Level 2 valuations. · Annually every security holding is priced by a pricing service independent of the regular and recurring pricing services used. The independent service provides a measurement to indicate if the price assigned by the regular service is within or outside of a reasonable range. Management reviews this report and applies judgment in adjusting calculations at year end related to securities pricing. · Residential mortgage loans available for sale in the secondary market are carried at fair market value. The fair value of loans held-for-sale is determined using quoted secondary market prices. · Lending related commitments to fund certain residential mortgage loans, e.g. residential mortgage loans with locked interest rates to be sold in the secondary market and forward commitments for the future delivery of mortgage loans to third party investors as well as forward commitments for future delivery of MBS are considered derivatives. Fair values are estimated based on observable changes in mortgage interest rates including prices for MBS from the date of the commitment and do not typically involve significant judgments by management. · The fair value of mortgage servicing rights is based on a valuation model that calculates the present value of estimated net servicing income. The valuation model incorporates assumptions that market participants would use in estimating future net servicing income to derive the resultant value. The Company is able to compare the valuation model inputs, such as the discount rate, prepayment speeds, weighted average delinquency and foreclosure/bankruptcy rates to widely available published industry data for reasonableness. · Interest rate swap positions, both assets and liabilities, are based on valuation pricing models using an income approach reflecting readily observable market parameters such as interest rate yield curves. · The fair value of impaired loans with specific allocations of the ALLL is essentially based on recent real estate appraisals or the fair value of the collateralized asset. These appraisals may utilize a single valuation approach or a combination of approaches including comparable sales and the income approach. Adjustments are made in the appraisal process by the appraisers to reflect differences between the available comparable sales and income data. Such adjustments are usually significant and typically result in a Level 3 classification of the inputs for determining fair value. · Nonrecurring adjustments to certain commercial and residential real estate properties classified as OREO are measured at the lower of carrying amount or fair value, less costs to sell. Fair values are based on third party appraisals of the property, resulting in a Level 3 classification. In cases where the carrying amount exceeds the fair value, less costs to sell, an impairment loss is recognized. Assets and Liabilities Measured at Fair Value on a Recurring Basis : The tables below present the balance of assets and liabilities at December 31, 2018, and December 31, 2017, measured by the Company at fair value on a recurring basis: December 31, 2018 Level 1 Level 2 Level 3 Total Assets: Securities available-for-sale U.S. Treasury $ 3,923 $ - $ - $ 3,923 U.S. government agencies - 10,951 - 10,951 U.S. government agencies mortgage-backed - 14,075 - 14,075 States and political subdivisions - 265,902 8,165 274,067 Collateralized mortgage obligations - 64,429 - 64,429 Asset-backed securities - 109,514 - 109,514 Collateralized loan obligations - 64,289 - 64,289 Loans held-for-sale - 2,984 - 2,984 Mortgage servicing rights - - 7,357 7,357 Interest rate swap agreements - 672 - 672 Mortgage banking derivatives - 159 - 159 Total $ 3,923 $ 532,975 $ 15,522 $ 552,420 Liabilities: Interest rate swap agreements $ - $ 672 $ - $ 672 Total $ - $ 672 $ - $ 672 December 31, 2017 Level 1 Level 2 Level 3 Total Assets: Securities available-for-sale U.S. Treasury $ 3,947 $ - $ - $ 3,947 U.S. government agencies - 13,061 - 13,061 U.S. government agencies mortgage-backed - 12,214 - 12,214 States and political subdivisions - 263,831 14,261 278,092 Corporate bonds - 833 - 833 Collateralized mortgage obligations - 63,671 2,268 65,939 Asset-backed securities - 112,932 - 112,932 Collateralized loan obligations - 54,421 - 54,421 Loans held-for-sale - 4,067 - 4,067 Mortgage servicing rights - - 6,944 6,944 Interest rate swap agreements - 727 - 727 Mortgage banking derivatives - 238 - 238 Total $ 3,947 $ 525,995 $ 23,473 $ 553,415 Liabilities: Interest rate swap agreements $ - $ 2,014 $ - $ 2,014 Total $ - $ 2,014 $ - $ 2,014 The changes in Level 3 assets and liabilities measured at fair value on a recurring basis are as follows: Years Ended December 31, 2018 Securities available-for-sale Collateralized States and Mortgage Mortgage Political Servicing Obligation Subdivisions Rights Beginning balance January 1, 2018 $ 2,268 $ 14,261 $ 6,944 Transfers into Level 3 - - - Transfers out of Level 3 (1,308) - - Total gains or losses Included in earnings 35 - (181) Included in other comprehensive income 40 (746) - Purchases, issuances, sales, and settlements Purchases - 22,046 - Issuances - - 1,146 Settlements (1,035) (27,396) (552) Ending balance December 31, 2018 $ - $ 8,165 $ 7,357 Years Ended December 31, 2017 Securities available-for-sale Collateralized States and Mortgage Mortgage Political Servicing Obligation Subdivisions Rights Beginning balance January 1, 2017 $ 3,119 $ 22,226 $ 6,489 Transfers into Level 3 - - - Transfers out of Level 3 - - - Total gains or losses Included in earnings 40 - (270) Included in other comprehensive income 21 (796) - Purchases, issuances, sales, and settlements Purchases - 16,712 - Issuances - - 1,257 Settlements (912) (23,881) (532) Ending balance December 31, 2017 $ 2,268 $ 14,261 $ 6,944 The following table and commentary presents quantitative and qualitative information about Level 3 fair value measurements as of December 31, 2018: Weighted Measured at fair value Unobservable Average on a recurring basis: Fair Value Valuation Methodology Inputs Range of Input of Inputs Mortgage servicing rights $ 7,357 Discounted Cash Flow Discount Rate 10.0 - 229.7% 10.2 % Prepayment Speed 7.0 - 68.9% 9.6 % The following table and commentary presents quantitative and qualitative information about Level 3 fair value measurements as of December 31, 2017: Weighted Measured at fair value Unobservable Average on a recurring basis: Fair Value Valuation Methodology Inputs Range of Input of Inputs Mortgage servicing rights $ 6,944 Discounted Cash Flow Discount Rate 10.0 - 34.3% 10.2 % Prepayment Speed 7.0 - 68.4% 9.6 % In addition to the above, Level 3 fair value measurement included $8.2 million for state and political subdivisions representing various local municipality securities at December 31, 2018. Level 3 fair value measurement included $14.3 million on the state and political subdivisions line and $2.3 million of collateralized mortgage obligations at December 31, 2017. Given the small dollar amount and size of the municipality issuances involved, this is categorized as Level 3 based on the payment stream received by the Company from the municipalities. That payment stream is otherwise an unobservable input. Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis: The Company may be required, from time to time, to measure certain other assets at fair value on a nonrecurring basis in accordance with GAAP. These assets consist of impaired loans and OREO. For assets measured at fair value on a nonrecurring basis at December 31, 2018, and December 31, 2017, the following tables provide the level of valuation assumptions used to determine each valuation and the carrying value of the related assets: December 31, 2018 Level 1 Level 2 Level 3 Total Impaired loans 1 $ - $ - $ 12,163 $ 12,163 Other real estate owned, net 2 - - 7,175 7,175 Total $ - $ - $ 19,338 $ 19,338 1 Represents carrying value and related write-downs of loans for which adjustments are substantially based on the appraised value of collateral for collateral-dependent loans, had a carrying amount of $12.5 million and a valuation allowance of $352,000, resulting in an increase of specific allocations within the provision for loan and lease losses of $208,000 for the year ending December 31, 2018. 2 OREO is measured at the lower of carrying or fair value less costs to sell, and had a net carrying amount of $7.2 million, which is made up of the outstanding balance of $16.1 million, net of a valuation allowance of $8.0 million and participations of $900,000, at December 31, 2018. December 31, 2017 Level 1 Level 2 Level 3 Total Impaired loans 1 $ - $ - $ 5,113 $ 5,113 Other real estate owned, net 2 - - 8,371 8,371 Total $ - $ - $ 13,484 $ 13,484 1 Represents carrying value and related write-downs of loans for which adjustments are substantially based on the appraised value of collateral for collateral-dependent loans, had a carrying amount of $5.3 million and a valuation allowance of $144,000, resulting in an increase of specific allocations within the provision for loan and lease losses of $856,000 for the year ending December 31, 2017. 2 OREO is measured at the lower of carrying or fair value less costs to sell, and had a net carrying amount of $8.4 million, which is made up of the outstanding balance of $17.4 million, net of a valuation allowance of $8.2 million and participations of $900,000, at December 31, 2017. The Company also has assets that under certain conditions are subject to measurement at fair value on a nonrecurring basis. These assets include OREO and impaired loans. The Company has estimated the fair values of these assets based primarily on Level 3 inputs. OREO and impaired loans are generally valued using the fair value of collateral provided by third party appraisals. These valuations include assumptions related to cash flow projections, discount rates, and recent comparable sales. The numerical range of unobservable inputs for these valuation assumptions are not meaningful.

Fair Values of Financial Instru

Fair Values of Financial Instruments	12 Months Ended
	Dec. 31, 2018
Fair Values of Financial Instruments
Fair Values of Financial Instruments	Note 19: Fair Value of Financial Instruments The estimated fair values approximate carrying amount for all items except those described in the following table. Securities available-for-sale fair values are based upon market prices or dealer quotes, and if no such information is available, on the rate and term of the security. The carrying value of FHLBC stock approximates fair value as the stock is nonmarketable and can only be sold to the FHLBC or another member institution at par. FHLBC stock is carried at cost and considered a Level 2 fair value. For December 31, 2018, the fair values of loans and leases are estimated on an exit price basis incorporating discounts for credit, liquidity and marketability factors. This is not comparable with the fair value disclosures for December 31, 2017, which were estimated using an entrance price basis. For December 31, 2017, fair values of variable rate loans and leases with no significant change in credit risk were based on carrying values. The fair values of other loans and leases were estimated using discounted cash flow analyses which used interest rates being offered for loans and leases with similar terms to borrowers of similar credit quality. The fair value of time deposits is estimated using discounted future cash flows at current rates offered for deposits of similar remaining maturities. The fair values of borrowings were estimated based on interest rates available to the Company for debt with similar terms and remaining maturities. The fair value of off balance sheet volume is not considered material. The fair value of mortgage banking derivatives is discussed in Note 17: Mortgage Banking Derivatives, above. The carrying amount and estimated fair values of financial instruments were as follows: December 31, 2018 Carrying Fair Amount Value Level 1 Level 2 Level 3 Financial assets: Cash and due from banks $ 38,599 $ 38,599 $ 38,599 $ - $ - Interest bearing deposits with financial institutions 16,636 16,636 16,636 - - Securities available-for-sale 541,248 541,248 3,923 529,160 8,165 FHLBC and FRBC Stock 13,433 13,433 - 13,433 - Loans held-for-sale 2,984 2,984 - 2,984 - Net loans 1,878,021 1,867,594 - - 1,867,594 Accrued interest receivable 10,940 10,940 - 10,940 - Financial liabilities: Noninterest bearing deposits $ 618,830 $ 618,830 $ 618,830 $ - $ - Interest bearing deposits 1,497,843 1,495,614 - 1,495,614 - Securities sold under repurchase agreements 46,632 46,632 - 46,632 - Other short-term borrowings 149,500 149,500 - 149,500 - Junior subordinated debentures 57,686 47,625 32,989 14,636 - Senior notes 44,158 45,008 45,008 - - Note payable and other borrowings 15,379 18,050 - 18,050 - Interest rate swap agreements 58 58 - 58 - Borrowing interest payable 281 281 - 281 - Deposit interest payable 973 973 - 973 - December 31, 2017 Carrying Fair Amount Value Level 1 Level 2 Level 3 Financial assets: Cash and due from banks $ 37,444 $ 37,444 $ 37,444 $ - $ - Interest bearing deposits with financial institutions 18,389 18,389 18,389 - - Securities available-for-sale 541,439 541,439 3,947 520,963 16,529 FHLBC and FRBC Stock 10,168 10,168 - 10,168 - Loans held-for-sale 4,067 4,067 - 4,067 - Net loans 1,600,161 1,586,722 - - 1,586,722 Accrued interest receivable 8,595 8,595 - 8,595 - Financial liabilities: Noninterest bearing deposits $ 572,404 $ 572,404 $ 572,404 $ - $ - Interest bearing deposits 1,350,521 1,346,339 - 1,346,339 - Securities sold under repurchase agreements 29,918 29,918 - 29,918 - Other short-term borrowings 115,000 115,000 - 115,000 - Junior subordinated debentures 57,639 59,471 33,267 26,204 - Senior notes 44,058 46,743 46,743 - - Interest rate swap agreements 1,287 1,287 - 1,287 - Borrowing interest payable 140 140 - 140 - Deposit interest payable 631 631 - 631 -

Financial Instruments with Off-

Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions	12 Months Ended
	Dec. 31, 2018
Derivative Excluding Mortgage Banking Derivatives
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions	Note 20: Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions Risk Management Objective of Using Derivatives The Company is exposed to certain risk arising from both its business operations and economic conditions. The Company principally manages its exposures to a wide variety of business and operational risks through management of its core business activities. The Company manages economic risks, including interest rate, liquidity, and credit risk primarily by managing the amount, sources, and duration of its assets and liabilities and the use of derivative financial instruments. Specifically, the Company enters into derivative financial instruments to manage exposures that arise from business activities that result in the receipt or payment of future known and uncertain cash amounts, the value of which are determined by interest rates. The Company’s derivative financial instruments are used to manage differences in the amount, timing, and duration of the Company’s known or expected cash receipts and its known or expected cash payments principally related to the Company’s loan portfolio. Cash Flow Hedges of Interest Rate Risk The Company’s objectives in using interest rate derivatives are to add stability to interest expense and to manage its exposure to interest rate movements. To accomplish this objective, the Company primarily uses interest rate swaps as part of its interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the receipt of variable-rate amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. During 2018, such derivatives were used to hedge the variable cash flows associated with existing variable-rate borrowings. For derivatives designated and that qualify as cash flow hedges of interest rate risk, the gain or loss on the derivative is recorded in Accumulated Other Comprehensive Income and subsequently reclassified into interest expense in the same period(s) during which the hedged transaction affects earnings. Amounts reported in accumulated other comprehensive income related to derivatives will be reclassified to interest expense as interest payments are received on the Company’s variable-rate borrowings. During the next twelve months, the Company estimates that an additional $24,000 will be reclassified as an increase to interest expense. Non-designated Hedges Derivatives not designated as hedges are not speculative and result from a service the Company provides to certain customers. The Company executes interest rate swaps with commercial banking customers to facilitate their respective risk management strategies. Those interest rate swaps are simultaneously hedged by offsetting derivatives that the Company executes with a third party, such that the Company minimizes its net risk exposure resulting from such transactions. As the interest rate derivatives associated with this program do not meet the strict hedge accounting requirements, changes in the fair value of both the customer derivatives and the offsetting derivatives are recognized directly in earnings. The Company also grants mortgage loan interest rate lock commitments to borrowers, subject to normal loan underwriting standards. The interest rate risk associated with these loan interest rate lock commitments is managed with contracts for future deliveries of loans as well as selling forward mortgage-backed securities contracts. Loan interest rate lock commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. Commitments to originate residential mortgage loans held-for-sale and forward commitments to sell residential mortgage loans or forward MBS contracts are considered derivative instruments and changes in the fair value are recorded to mortgage banking revenue. Fair values are estimated based on observable changes in mortgage interest rates including mortgage-backed securities prices from the date of the commitment. Disclosure of Fair Values of Derivative Instruments on the Balance Sheet The Company entered into a forward starting interest rate swap on August 18, 2015, with an effective date of June 15, 2017. This transaction had a notional amount totaling $25.8 million as of December 31, 2018, was designated as a cash flow hedge of certain junior subordinated debentures and was determined to be fully effective during the period presented. As such, no amount of ineffectiveness has been included in net income. Therefore, the aggregate fair value of the swap is recorded in other liabilities with changes in fair value recorded in other comprehensive income, net of tax. The amount included in other comprehensive income would be reclassified to current earnings should all or a portion of the hedge no longer be considered effective. The Company expects the hedge to remain fully effective during the remaining term of the swap. The Bank will pay the counterparty a fixed rate and receive a floating rate based on three month LIBOR. The trust preferred securities changed from fixed rate to floating rate in June 15, 2017. The cash flow hedge has a maturity date of June 15, 2037. The Bank also has interest rate derivative positions to assist with risk management that are not designated as hedging instruments. These derivative positions relate to transactions in which the Bank enters an interest rate swap with a client while at the same time entering into an offsetting interest rate swap with another financial institution. The Bank had $260,000 of cash collateral pledged with one correspondent financial institution to support interest rate swap activity at December 31, 2018; no investment securities were required to be pledged. At December 31, 2017, $4.2 million in investment securities were pledged to support interest rate swap activity with one correspondent financial institution; no cash was required to be pledged. At December 31, 2018, the notional amount of non-hedging interest rate swaps was $188.9 million with a weighted average maturity of 6.6 years. At December 31, 2017, the notional amount of non-hedging interest rate swaps was $153.4 million with a weighted average maturity of 6.6 years. The Bank offsets derivative assets and liabilities that are subject to a master netting arrangement. The table below presents the fair value of the Company’s derivative financial instruments as well as their classification on the Balance Sheet as of December 31, 2018 and 2017. Fair Value of Derivative Instruments December 31, 2018 No. of Trans. Notional Amount $ Balance Sheet Location Fair Value $ Balance Sheet Location Fair Value $ Derivatives designated as hedging instruments Interest rate swaps 25,774 Other Assets - Other Liabilities 58 Total derivatives designated as hedging instruments - 58 Derivatives not designated as hedging instruments Interest rate swaps with commercial loan customers 188,931 Other Assets 672 Other Liabilities 672 Interest rate lock commitments and forward contracts 18,130 Other Assets 159 Other Liabilities - Other contracts 18,155 Other Assets - Other Liabilities 26 Total derivatives not designated as hedging instruments 831 698 December 31, 2017 No. of Trans. Notional Amount $ Balance Sheet Location Fair Value $ Balance Sheet Location Fair Value $ Derivatives designated as hedging instruments Interest rate swaps 25,774 Other Assets - Other Liabilities 1,287 Total derivatives designated as hedging instruments - 1,287 Derivatives not designated as hedging instruments Interest rate swaps with commercial loan customers 153,433 Other Assets 727 Other Liabilities 727 Interest rate lock commitments and forward contracts 26,978 Other Assets 238 Other Liabilities - Other contracts 15,959 Other Assets - Other Liabilities 13 Total derivatives not designated as hedging instruments 965 740 Disclosure of the Effect of Fair Value and Cash Flow Hedge Accounting The fair value and cash flow hedge accounting related to derivatives covered under ASC Subtopic 815-20 impacted Accumulated Other Comprehensive Income (“AOCI”) and the Income Statement. The gain recognized in AOCI on derivatives totaled $1.2 million as of December 31, 2018, and a loss in AOCI of $59,000 as of December 31, 2017. The amount of the gain (loss) reclassified from AOCI to interest income or interest expense on the income statement totaled ($168,000) and ($212,000) for the years ended December 31, 2018, and December 31, 2017, respectively. Credit-risk-related Contingent Features For derivative transactions involving counterparties who are lending customers of the Company, the derivative credit exposure is managed through the normal credit review and monitoring process, which may include collateralization, financial covenants and/or financial guarantees of affiliated parties. Agreements with such customers require that losses associated with derivative transactions receive payment priority from any funds recovered should a customer default and ultimate disposition of collateral or guarantees occur. Credit exposure to broker/dealer counterparties is managed through agreements with each derivative counterparty that require collateralization of fair value gains owed by such counterparties. Some small degree of credit exposure exists due to timing differences between when a gain may occur and the subsequent point in time that collateral is delivered to secure that gain. This is monitored by the Company and procedures are in place to minimize this exposure. Such agreements also require the Company to collateralize counterparties in circumstances wherein the fair value of the derivatives result in loss to the Company. Other provisions of such agreements define certain events that may lead to the declaration of default and/or the early termination of the derivative transaction(s), including the following: · if the Company either defaults or is capable of being declared in default on any of its indebtedness (exclusive of deposit obligations); · if a merger occurs that materially changes the Company's creditworthiness in an adverse manner; or · If certain specified adverse regulatory actions occur, such as the issuance of a Cease and Desist Order, or citations for actions considered Unsafe and Unsound or that may lead to the termination of deposit insurance coverage by the Federal Deposit Insurance Corporation.

Preferred Stock

Preferred Stock	12 Months Ended
	Dec. 31, 2018
Preferred Stock.
Preferred Stock	Note 21: Preferred Stock The Series B preferred stock was issued as part of the Treasury’s Troubled Asset Relief Program and Capital Purchase Program in 2009. Concurrent with issuing the Series B preferred stock in 2009, the Company issued to the Treasury a ten year warrant to purchase 815,339 shares of the Company’s common stock at an exercise price of $13.43 per share. The Company recorded the warrant as equity, and the allocation was based on their relative fair values in accordance with accounting guidance. The fair value was determined for both the Series B preferred stock and the warrant as part of the allocation process in the amounts of $68.2 million and $4.8 million, respectively. In 2014 and 2015, the Company completed redemption of all 73,000 shares of Series B preferred stock issued in 2009. As of December 31, 2018 and 2017, the only remaining component of the 2009 issuance was the warrant outstanding for 815,339 shares, valued at $4.8 million and carried within stockholders’ equity. Preferred stock of 300,000 shares is authorized but unissued as of December 31, 2018 and 2017. On January 16, 2019, the warrant was exercised; see further disclosures in Note 1: Subsequent Events, above.

Parent Company Condensed Financ

Parent Company Condensed Financial Information	12 Months Ended
	Dec. 31, 2018
Parent Company Condensed Financial Information
Parent Company Condensed Financial Information	Note 22: Parent Company Condensed Financial Information Condensed Balance Sheets as of December 31 were as follows: 2018 2017 Assets Noninterest bearing deposit with bank subsidiary $ 9,039 $ 23,011 Investment in subsidiaries 315,252 263,389 Other assets 12,997 17,139 Total assets $ 337,288 $ 303,539 Liabilities and Stockholders’ Equity Other short term borrowings $ 4,000 $ - Junior subordinated debentures 57,686 57,639 Senior notes 44,158 44,058 Other liabilities 2,363 1,492 Stockholders’ equity 229,081 200,350 Total liabilities and stockholders' equity $ 337,288 $ 303,539 Condensed Statements of Income for the years ended December 31 were as follows: 2018 2017 2016 Operating Income Cash dividends received from subsidiaries $ 30,000 $ - $ - Other income 106 114 130 Total operating income 30,106 114 130 Operating Expenses Junior subordinated debentures 3,716 4,002 4,334 Senior notes 2,688 2,689 112 Subordinated debt - - 949 Other interest expense 98 - 8 Other expenses 4,208 2,639 1,975 Total operating expense 10,710 9,330 7,378 Income (loss) before income taxes and equity in undistributed net income of subsidiaries 19,396 (9,216) (7,248) Income tax benefit (3,355) (16) (2,909) Income (loss) before equity in undistributed net income of subsidiaries 22,751 (9,200) (4,339) Equity in undistributed net income of subsidiaries 11,261 24,338 20,023 Net income available to common stockholders $ 34,012 $ 15,138 $ 15,684 Condensed Statements of Cash Flows for the years ended December 31 were as follows: 2018 2017 2016 Cash Flows from Operating Activities Net Income $ 34,012 $ 15,138 $ 15,684 Adjustments to reconcile net income to net cash from operating activities: Equity in undistributed net income of subsidiaries (11,261) (24,338) (20,023) Provision for deferred tax expense (benefit) 6,697 6,397 (1,039) Net deferred tax expense due to DTA revaluation - 3,908 - Change in taxes payable (1,211) (4,797) 330 Change in other assets 97 74 171 Stock-based compensation 2,257 1,181 657 Other, net 172 (15) 282 Net cash (used in) provided by operating activities 30,763 (2,452) (3,938) Cash Flows from Investing Activities Cash paid for acquisition, net of cash and cash equivalents retained (47,074) - - Net cash (used in) investing activities (47,074) - - Cash Flows from Financing Activities Net change in other short-term borrowings 4,000 Dividend paid on common stock (1,189) (1,184) (888) Purchases of treasury stock (505) (236) (254) Proceeds from the issuance of senior notes - - 43,994 Payment of senior note issuance costs - (42) - Repayment of subordinated debt - - (45,000) Repayment of note payable - - (500) Proceeds from exercise of stock (option) 33 - 11 Net cash provided by (used in) financing activities 2,339 (1,462) (2,637) Net change in cash and cash equivalents (13,972) (3,914) (6,575) Cash and cash equivalents at beginning of year 23,011 26,925 33,500 Cash and cash equivalents at end of year $ 9,039 $ 23,011 $ 26,925

Employee Benefit Plans

Employee Benefit Plans	12 Months Ended
	Dec. 31, 2018
Employee Benefit Plans
Employee Benefit Plans	Note 23: Employee Benefit Plans Old Second Bancorp, Inc. Employees 401(k) Savings Plan and Trust The Company sponsors a qualified, tax-exempt defined contribution plan (the “401(k) Plan”) qualifying under section 401(k) of the Internal Revenue Code. Virtually all employees are eligible to participate after meeting certain age and service requirements. Eligible employees are permitted to contribute up to a dollar limit set by law of their compensation to the 401(k) Plan. For the year ended December 31, 2018, the Company made a discretionary match equal to 100% of the first 3% and 50% of the next 2% to participants of the 401(k) Plan. For the years ended December 31, 2017 and 2016, the Company made a discretionary match equal to 100% of first 3% contributed by participants of the 401(k) Plan. Participants are 100% vested in the discretionary matching contributions. Participants can choose between several different investment options under the 401(k) Plan, including shares of the Company’s common stock. An additional component of the 401(k) Plan arrangement allows the Company to make annual discretionary profit sharing contributions based on the Company’s profitability in a given year, and on each participant’s annual compensation. The Company elected not to make a discretionary profit sharing contribution for the years end December 31, 2018, 2017 and 2016. The total expense relating to the 401(k) Plan was approximately $1.1 million, $785,000 and $698,000 in 2018, 2017 and 2016, respectively. Old Second Bancorp, Inc. Voluntary Deferred Compensation Plan for Executives The Company sponsors an executive deferred compensation plan, which is a means by which certain executives may voluntarily defer a portion of their salary or bonus. This plan is an unfunded, nonqualified deferred compensation arrangement. Company obligations under this arrangement as of both December 31, 2018 and 2017 totaled $2.2 million and totaled $1.6 million as of December 31, 2016, and are included in other liabilities.

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Policies)-10K	12 Months Ended
	Dec. 31, 2018
Summary of Significant Accounting Policies
Basis of presentation	The consolidated financial statements of Old Second Bancorp, Inc., and Subsidiaries (the “Company”) include the financial statements of Old Second Bancorp, Inc., a registered bank holding company, and its wholly-owned bank, Old Second National Bank (the “Bank”). The Company uses the accrual basis of accounting for financial reporting purposes. Certain amounts in prior year financial statements have been reclassified to conform to the 2018 presentation.
Use of Estimates	Use of Estimates – The preparation of consolidated financial statements in conformity with generally accepted accounting principles (“GAAP”) and following general practices within the banking industry requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Although these estimates and assumptions are based on the best available information, actual results could differ from those estimates.
Principles of Consolidation	Principles of Consolidation – The accompanying consolidated financial statements include the accounts and results of operations of the Company and its subsidiaries after elimination of all significant intercompany accounts and transactions. Assets held in a fiduciary or agency capacity are not assets of the Company or its subsidiaries and are not included in the consolidated financial statements.
Segment Reporting	Segment Reporting – An operating segment is a component of a business entity that engages in business activity from which it may earn revenues and/or incur expenses. It has operating results that are reviewed regularly by the entity’s chief operating decision maker in order to make decisions about resource allocation and performance assessment, and the segment has discrete financial information available for this assessment. As of December 31, 2018, the Company had one operating segment, which is community banking. Therefore, segment reporting is not required
Cash and Cash Equivalents	Cash and Cash Equivalents – For purposes of the Consolidated Statements of Cash Flows, management has defined cash and cash equivalents to include cash and due from banks, interest-bearing deposits in other banks, and other short-term investments, such as federal funds sold and securities purchased under agreements to resell. The classification of cash and cash equivalents includes those assets held in the form of cash or liquid instruments with a maturity of 90 days or less.
Securities	Securities – Securities are classified as available-for-sale or held-to-maturity at the time of purchase or transfer. Securities that are classified as available-for-sale are carried at fair value. Unrealized gains and losses, net of related deferred income taxes, are recorded in stockholders’ equity as a separate component of accumulated other comprehensive income or loss. Unrealized gains and losses are not included in the calculation of regulatory capital. Securities held-to-maturity are carried at amortized cost and the discount or premium created at acquisition or in the transfer from available-for-sale is accreted or amortized to the maturity or expected payoff date but not an earlier call. Discounts are accreted into interest income over the estimated life of the related security and premiums are amortized into income to the earlier of the call date or estimated life of the related security using the level yield method. Purchases and sales of securities are recognized on a trade date basis. Realized securities gains or losses are reported in securities gains (losses), net, in the Consolidated Statements of Income. The cost of securities sold is based on the specific identification method. On a quarterly basis, the Company makes an assessment (at the individual security level) to determine whether there have been any events or circumstances indicating that a security with an unrealized loss is other-than-temporarily impaired (“OTTI”). In evaluating OTTI, the Company considers many factors, including the severity and duration of the impairment; the financial condition and near-term prospects of the issuer, which for debt securities considers external credit ratings and recent downgrades; its ability and intent to hold the security for a period of time sufficient for a recovery in value; and the likelihood that it will be required to sell the security before a recovery in value, which may be at maturity. The amount of the impairment related to other factors is recognized in other comprehensive income (loss) unless management intends to sell the security or believes it is more likely than not that it will be required to sell the security prior to full recovery.
Federal Home Loan Bank and Federal Reserve Bank Stock	Federal Home Loan Bank and Federal Reserve Bank Stock – The Company owns the stock of the Federal Home Loan Bank of Chicago (“FHLBC”) and the Federal Reserve Bank of Chicago (“FRBC”). Both of these entities require the Bank to invest in their nonmarketable stock as a condition of membership. The FHLBC is a governmental sponsored entity. The Bank continues to utilize the various products and services of the FHLBC and management considers this stock to be a long-term investment. FHLBC members are required to own a certain amount of stock based on the level of borrowings and other factors, and may invest in additional amounts. FHLBC stock is carried at cost, classified as a restricted security, and periodically evaluated for impairment based on ultimate recovery of par value. The Company’s ability to redeem the shares owned is dependent on the redemption practices of the FHLBC. The Company records dividends in income on the ex-dividend date. FRBC stock is redeemable at par, and therefore fair value equals cost.
Loans Held-for-Sale	Loans Held-for-Sale – The Bank originates residential mortgage loans, which consist of loan products eligible for sale to the secondary market. Residential mortgage loans eligible for sale in the secondary market are carried at fair market value. The fair value of loans held-for-sale is determined using quoted secondary market prices on similar loans.
Loans	Loans – Loans held-for-investment are carried at the principal amount outstanding, including certain net deferred loan origination fees and costs. Loans purchased as a result of a business combination are recorded at estimated fair value on the acquisition date, with no carryover of the related allowance for loan and lease losses recorded by the acquiree at the time of purchase. These loans are segregated into two classifications upon purchase: 1) purchased non-credit impaired (“non-PCI”) loans, accounted for in accordance with FASB ASC Subtopic 310-20 “ Nonrefundable Fees and Costs ” (“ASC 310-20”), as these loans do not have evidence of credit deterioration since origination. The premiums and discounts created when ASC 310-20 loans are recorded at their fair values at acquisition are recorded to income over the remaining life of the loan as an adjustment to the related loan’s yield; and 2) purchased credit impaired (“PCI”) loans, accounted for under FASB ASC Subtopic 310-30, “ Loans and Debt Securities Acquired with Deteriorated Credit Quality ” (“ASC 310-30”) as they display signs of credit deterioration since origination. Interest income, through accretion of the difference between the carrying value of the loans and the expected cash flows, is recognized on the acquired loans accounted for under ASC 310-30. Interest income on loans is accrued based on principal amounts outstanding. Loan and lease origination fees, commitment fees, and certain direct loan origination costs are deferred and amortized over the life of the related loans or commitments as a yield adjustment. The acquisition adjustment discount related to purchased loans is accreted into interest income over the contractual life of each loan, or is generally taken into income immediately upon payoff or renewal of the loan. Fees related to standby letters of credit, whose ultimate exercise is remote, are amortized into fee income over the estimated life of the commitment. Other credit-related fees are recognized as fee income when earned.
Concentration of Credit Risk	Concentration of Credit Risk – Most of the Company’s business activity is with customers located within Cook, DeKalb, DuPage, Kane, Kendall, LaSalle and Will counties in Illinois. These banking centers surround or are within the Chicago metropolitan area. Therefore, the Company’s exposure to credit risk is significantly affected by changes in the economy in that market area since the Bank generally makes loans within its market. There are no significant concentrations of loans where the customers’ ability to honor loan terms is dependent upon a single economic sector.
Lease financing receivables	Lease Financing Receivables – Lease financing receivables are subject to underwriting standards and processes similar to commercial loans. These loans are often secured by equipment or transportation assets, and are made based primarily on the historical and projected cash flow of the borrower and secondarily on the underlying collateral provided by the borrower. The cash flows of borrowers, however, may not behave as forecasted and collateral securing loans may fluctuate in value due to economic or individual performance factors.
Nonaccrual loans	Nonaccrual Loans – Generally, commercial and consumer loans, as well as loans secured by real estate are placed on nonaccrual status (i) when either principal or interest payments become 90 days or more past due based on contractual terms unless the loan is sufficiently collateralized such that full repayment of both principal and interest is expected and is in the process of collection within a reasonable period or (ii) when an individual analysis of a borrower’s creditworthiness indicates a credit should be placed on nonaccrual status whether or not the loan is 90 days or more past due. When a loan is placed on nonaccrual status, unpaid interest credited to income is reversed. Generally, after the loan is placed on nonaccrual, all debt service payments are applied to the principal on the loan. Nonaccrual loans are returned to accrual status when the financial position of the borrower and other relevant factors indicate there is no longer doubt that the Company will collect all principal and interest due. Commercial, consumer and real estate loans are generally charged-off when deemed uncollectible. A loss is recorded at that time if the net realizable value can be quantified and it is less than the associated principal outstanding.
Troubled Debt Restructurings (TDRs)	Troubled Debt Restructurings (“TDRs”) – A restructuring of debt is considered a TDR when (i) the borrower is experiencing financial difficulties and (ii) the creditor grants a concession, such as forgiveness of principal, reduction of the interest rate, changes in payments, or extension of the maturity, that it would not otherwise consider. Loans are not classified as TDRs when the modification is short-term or results in only an insignificant delay or shortfall in the payments to be received. The Company’s TDRs are determined on a case-by-case basis in connection with ongoing loan collection processes. The Company does not accrue interest on any TDRs unless it believes collection of all principal and interest under the modified terms is reasonably assured. For TDRs to accrue interest, the borrower must demonstrate both some level of past performance and the capacity to perform under the modified terms. Generally, six months of consecutive payment performance by the borrower under the restructured terms is required before TDRs are returned to accrual status. However, the period could vary depending on the individual facts and circumstances of the loan. An evaluation of the borrower’s current creditworthiness is used to assess whether the borrower has the capacity to repay the loan under the modified terms. This evaluation includes an estimate of expected cash flows, evidence of strong financial position, and estimates of the value of collateral, if applicable.
Impaired Loans	Impaired Loans – Impaired loans consist of nonaccrual loans and TDRs (both accruing and on nonaccrual). A loan is considered impaired when it is probable that the Company will be unable to collect all contractual principal and interest due according to the terms of the loan agreement based on current information and events. With the exception of TDRs still accruing interest, loans deemed to be impaired are classified as nonaccrual and are exclusive of smaller homogeneous loans, such as HELOCs, 1-4 family mortgages, and consumer loans.
90-Days or Greater Past Due Loans	90-Days or Greater Past Due Loans – 90-days or greater past due loans are loans with principal or interest payments three months or more past due, but that still accrue interest. The Company continues to accrue interest if it determines these loans are sufficiently collateralized and the process of collection will conclude within a reasonable time period.
Allowance for Loan Losses	Allowance for Loan and Lease Losses (“ALLL”) – The ALLL is calculated according to GAAP standards and is maintained by management at a level believed adequate to absorb estimated losses inherent in the existing loan portfolio. Determination of the ALLL is inherently subjective since it requires significant estimates and management judgment, and includes a level of imprecision given the difficulty of identifying and assessing the factors impacting loan repayment and estimating the timing and amount of losses. While management utilizes its best judgment and information available, the ultimate adequacy of the ALLL is dependent upon a variety of factors beyond the Company’s direct control, including the performance of the loan portfolio, consideration of current economic trends, changes in interest rates and property values, the amounts and timing of expected future cash flows on impaired loans, estimated losses on pools of homogeneous loans based on an analysis that uses historical loss experience, portfolio growth and concentration risk, management and staffing changes, the interpretation of loan risk classifications by regulatory authorities and other credit market factors. While each component of the ALLL is determined separately, the entire balance is available for the entire loan portfolio. Loans deemed to be uncollectible are charged-off against the ALLL while recoveries of amounts previously charged-off are credited to the ALLL. Approved releases from previously established loan loss reserves authorized under our allowance methodology also reduce the ALLL. Additions to the allowance are established through the provision for loan and lease losses charged to expense. The ALLL methodology consists of (i) specific reserves established for probable losses on individual loans for which the recorded investment in the loan exceeds the present value of expected future cash flows or the net realizable value of the underlying collateral, if collateral dependent, (ii) an allowance based on a historical loss analysis that uses credit loss experience for the prior 20 quarters for each loan category, and (iii) the impact of other internal and external qualitative and credit market factors as assessed by management through detailed loan review, allowance analysis and credit discussions. In 2016, the Company significantly refined its ALLL methodology to further stratify the loan portfolio and apply unique factors to each segment. The changes implemented in 2016 segregate the total loan portfolio into further detail, moving from seven loan classifications to nine when applying management risk factors, and from four loan classifications to nine when applying historical loss rates. The Company also enhanced the prior process of applying management risk factors for changes in loans portfolio trends, such as factors for changes in the trend or volume of past due and classified loans, changes in the nature and volume of the portfolio and concentrations, changes in lending policy, procedures, management and staffing, and other external factors. These factors were historically analyzed in the aggregate to arrive at one risk factor per loan classification; under the revised methodology, the Company assigns each of these components its own risk factor, as well as encompasses an additional risk rating for loans rated as pass/watch. The Company continued to refine its ALLL methodology in 2017, with implementation of additional management factor classifications for newer loan portfolios, such as the Company’s recent purchase of home equity lines of credit (“HELOCs”) and the recently expanded business development company loan portfolio, as these portfolios have not been outstanding long enough to be sufficiently seasoned. In addition, the Company revised the risk weightings for the historical loss factors to allocate an increase in the loss factor applied in the earliest quarter, and a like reduction of the loss factor in the most recent quarter, as management believes the lower charge-off levels in the more recent quarters will likely not continue long-term. The Company refined its ALLL methodology again in 2018, as the Company determined that a minimum threshold of two basis points should be used for those quarters within the historical loss calculation with minimal or no losses incurred. In addition, a base line for reserves was set for economic conditions, past due and classified loans, loan portfolio/ concentrations, general and external factors. These factors are evaluated quarterly by the Bank’s ALLL Committee and the ASC 450 percentages are adjusted according to the overall bias in the individual factors (up, down or neutral). In the first quarter of 2018, these baseline levels were modified to establish floors and ceilings for each management factor. The establishment of floors and ceilings for management factors will allow management to evaluate changes to factors within prescribed guidelines and to remain consistent with factor determination in a stressed scenario, as a ceiling could be applied. These modifications to the Company’s ALLL methodology are intended to more accurately reflect all portfolio risk, and resulted in a consistent balance for the overall unallocated component of the allowance over the past two years. The unallocated component of the allowance was $537,000 as of December 31, 2018, compared to $542,000 as of December 31, 2017 and $435,000 as of December 31, 2016. All calculations conform to GAAP.
Premises and Equipment	Premises and Equipment – Premises, furniture, equipment, and leasehold improvements are stated at cost less accumulated depreciation and amortization. Depreciation expense is determined by the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized on a straight-line basis over the shorter of the life of the asset or the lease term including anticipated renewals. Rates of depreciation are generally based on the following useful lives: buildings, 25 to 40 years; building improvements, 3 to 15 years or longer under limited circumstances; and furniture and equipment, 3 to 10 years. Gains and losses on dispositions are included in other noninterest income in the Consolidated Statements of Income. Maintenance and repairs are charged to operating expenses as incurred, while improvements that conform to definitions of tangible property improvements are capitalized and depreciated over the estimated remaining life.
Other Real Estate Owned ("OREO")	Other Real Estate Owned (“OREO”) – Real estate assets acquired in settlement of loans are recorded at the fair value of the property when acquired, less estimated costs to sell, establishing a new cost basis. Physical possession of residential real estate property collateralizing a consumer mortgage loan occurs when legal title is obtained upon foreclosure or when the borrower conveys all interest in the property to satisfy the loan through completion of a deed in lieu of foreclosure or through a similar legal agreement. Any deficiency between the net book value and fair value at the foreclosure or deed in lieu date is charged to the ALLL. Any reduction in OREO carrying value within 90 days of transfer to OREO would be charged to the ALLL. If a determination is made more than 90 days after the transfer to OREO that the fair value for the OREO property has declined, an OREO valuation allowance is established for the decrease between the recorded value and the updated fair value less costs to sell. Such declines are included in other noninterest expense in the Consolidated Statements of Income. A subsequent reversal of an OREO valuation adjustment can occur, but the resultant carrying value cannot exceed the cost basis established at transfer of the loan to OREO. Operating costs after acquisition are also expensed.
Mortgage Servicing Rights	Mortgage Servicing Rights – The Bank is also involved in the business of servicing mortgage loans. Servicing activities include collecting principal, interest, and escrow payments from borrowers, making tax and insurance payments on behalf of the borrowers, monitoring delinquencies, executing foreclosure proceedings, and accounting for and remitting principal and interest payments to the investors. Mortgage servicing rights represent the right to a stream of cash flows and an obligation to perform specified residential mortgage servicing activities. Mortgage loans that the Company is servicing for others aggregated to $711.1 million and $695.1 million at December 31, 2018, and 2017, respectively. Mortgage loans that the Company is servicing for others are not included in the consolidated balance sheets. Fees received in connection with servicing loans for others are recognized as earned. Loan servicing costs are charged to expense as incurred. Servicing rights are recognized separately as assets when they are acquired through sales of loans and servicing rights are retained. Servicing rights are initially recorded at fair value with the effect recorded in net gains on sales of mortgage loans in the Consolidated Statements of Income. Fair value is based on market prices for comparable mortgage servicing contracts, when available, or alternatively, is based on a valuation model that calculates the present value of estimated future net servicing income. The valuation model incorporates assumptions that market participants would use in estimating future net servicing income, such as the cost to service, the discount rate, the custodial earnings rate, an inflation rate, ancillary income, prepayment speeds and default rates and losses. Servicing fee income, which is included in the Consolidated Statements of Income as mortgage servicing income, is recorded for fees earned for servicing loans. The fees are based on a contractual percentage of the outstanding principal or a fixed amount per loan and are recorded as income when earned. Under the fair value measurement method, the Company measures mortgage servicing rights at fair value at each reporting date, reports changes in fair value of servicing assets in earnings in the period in which the changes occur, and includes these changes in mortgage servicing rights mark to market in the Consolidated Statements of Income. The fair values of mortgage servicing rights are subject to significant fluctuations as a result of changes in estimated and actual prepayment speeds and default rates and losses.
Bank-Owned Life Insurance ("BOLI")	Bank-Owned Life Insurance (“BOLI”) – BOLI represents life insurance policies on the lives of certain Company employees (both current and former) for which the Company is the sole owner and beneficiary. These policies are recorded as an asset on the Consolidated Balance Sheets at their cash surrender value (“CSV”) or the amount that could be realized. The change in CSV is recorded as an increase in cash surrender value of bank-owned life insurance in the Consolidated Statements of Income in noninterest income. In addition, insurance proceeds received, net of the original premium investment, are recorded as death benefit realized on bank-owned life insurance in the Consolidated Statements of Income in noninterest income.
Goodwill and Core Deposit Intangible Assets	Goodwill and Core Deposit Intangible – Goodwill is the excess of an acquisition’s purchase price over the fair value of identified net assets acquired in an acquisition. Goodwill is not deemed to have definitive life span, and therefore is not amortized, but is subject to annual review for impairment. The annual review performed is qualitative in nature, and factors reviewed include macroeconomic data, industry specific data, current market conditions, and the Company’s overall financial performance. Based on management’s annual review of goodwill in the fourth quarter of 2018, no goodwill impairment was noted. The core deposit intangible (“CDI”) is being amortized on an accelerated method over a ten year estimated useful life. In 2018, CDI of $3.1 million was recorded stemming from the ABC Bank acquisition. As of December 31, 2018, $2.7 million of the ABC Bank CDI remained, which is in addition to the $465,000 of CDI remaining from the Talmer branch purchase as of December 31, 2018. Total CDI amortization expense of $387,000 was recorded in 2018. The expected future annual amortization expense for each of the next five years is approximately $483,000, $416,000, $380,000, $372,000, and $372,000.
Loss Contingencies	Debt Issuance Costs – Costs associated with the issuance of debt are presented in the Consolidated Balance Sheet as a direct reduction from the carrying value of that debt liability. The deferred issuance costs are amortized over the life the related debt instrument, and included within the debt’s interest expense. Loss Contingencies – Loss contingencies, including claims and legal actions arising in the ordinary course of business, are recorded as liabilities when the likelihood of loss is probable and an amount or range of loss can be reasonably estimated. Management does not believe there are such matters that will have a material effect on the financial statements.
Wealth Management	Wealth Management – Assets held in a fiduciary or agency capacity for customers are not included in the consolidated financial statements as they are not assets of the Company or its subsidiaries. Fee income is included as a component of noninterest income in the Consolidated Statements of Income.
Advertising Costs	Advertising Costs – All advertising costs incurred by the Company are expensed in the period in which they are incurred.
Equity Incentive Plan	Equity Incentive Plan – Compensation cost is recognized for stock options and restricted stock awards issued to employees based upon the fair value of the awards at the date of grant. A binomial model is utilized to estimate the fair value of stock options, which utilizes assumptions for expected volatilities based on the previous five-year historical volatilities of the Company's common stock. Historical data is used to estimate option exercise rates and post-vesting termination behavior, and the risk-free interest rate for the expected term of the option is based on the Treasury yield curve in effect at the time of grant. The market price of the Company’s common stock at the date of grant is used for restricted stock awards, which include restricted stock units. Compensation cost is recognized over the required service period, generally defined as the vesting period. Once the award is settled, the Company would determine whether the cumulative tax deduction exceeded the cumulative compensation cost recognized in the Consolidated Statement of Income. The cumulative tax deduction would include both the deductions from the dividends and the deduction from the exercise or vesting of the award. If the tax benefit received from the cumulative deductions exceeds the tax effect of the recognized cumulative compensation cost, the excess would be recognized as a credit to income tax expense.
Income Taxes	ncome Taxes – The Company files income tax returns in the U.S. federal jurisdiction, and in the states of Illinois, Indiana and Wisconsin. The provision for income taxes is based on income in the consolidated financial statements, rather than amounts reported on the Company’s income tax return. Income tax expense is the total of the current year income tax due or refundable and the change in deferred tax assets and liabilities. Any change in tax rates will be recorded in the period in which the law is enacted. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using the enacted tax rates that are expected to apply to taxable income in years in which those temporary differences are expected to be recovered or settled. As of December 31, 2018 and 2017, the Company evaluated tax positions taken for filing with the Internal Revenue Service and all state jurisdictions in which it operates. The Company believes that income tax filing positions will be sustained under examination and does not anticipate any adjustments that would result in a material adverse effect on the Company’s financial condition, results of operations, or cash flows. Accordingly, the Company has not recorded any reserves or related accruals for interest and penalties for uncertain tax positions at December 31, 2018 and 2017. The Company is currently open to audit under the statute of limitations by the Internal Revenue Service from 2015 to 2017, the state of Illinois from 2015 to 2017, and the states of Wisconsin and Indiana from 2009 to 2017.
Earnings Per Common Share ("EPS")	Earnings Per Common Share (“EPS”) – Basic EPS is computed by dividing net income applicable to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted EPS is computed by dividing net income applicable to common stockholders by the weighted-average number of common shares outstanding plus the number of additional common shares that would have been outstanding if the dilutive potential shares had been issued. The Company’s potential common shares represent shares issuable under its long-term incentive compensation plans and under the common stock warrant originally issued to preferred stockholders. Such common stock equivalents are computed based on the treasury stock method using the average market price for the period.
Treasury Stock	Treasury Stock – Treasury stock acquired is recorded at cost and is carried as a reduction of stockholders’ equity in the Consolidated Balance Sheet. Treasury stock issued is valued based on the “last in, first out” inventory method. The difference between the consideration received upon issuance and the carrying value is charged or credited to additional paid-in capital.
Derivative Financial Instruments	Derivative Financial Instruments – The Company occasionally enters into derivative financial instruments as part of its interest rate risk management strategies. These derivative financial instruments consist primarily of interest rate swaps. The Company records all derivatives on the balance sheet at fair value. The accounting for changes in the fair value of derivatives depends on the intended use of the derivative and whether the Company has elected to designate a derivative as a hedging relationship and apply hedge accounting. A further consideration involves a determination on whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting. Derivatives designated and qualifying as a hedge of the exposure to changes in the fair value of an asset, liability, or firm commitment attributable to a particular risk, such as interest rate risk, are considered fair value hedges. Hedge accounting generally provides for the matching of the timing of gain or loss recognition on the hedging instrument with the recognition of the changes in the fair value of the hedged asset or liability that are attributable to the hedged risk in a fair value hedge or the earnings effect of the hedged forecasted transactions in a cash flow hedge. The Company may enter into derivative contracts that are intended to economically hedge certain risks, even though hedge accounting does not apply or the Company elects not to apply hedge accounting. If it is determined that the derivative instrument is not highly effective as a hedge, hedge accounting is discontinued, and the adjustment to fair value of the derivative instrument is recorded in earnings. For a derivative used to hedge changes in cash flows associated with forecasted transactions, the gain or loss on the effective portion of the derivative are deferred and reported as a component of accumulated other comprehensive income, which is a component of stockholders’ equity, until such time the hedged transaction affects earnings. For derivative instruments not accounted for as hedges, changes in fair value are recognized in noninterest income/expense. Counterparty risk with loan customers is managed through loan covenant agreements and, as such, does not have a significant impact on the fair value of the swaps. Counterparty risk with other banks is managed through bilateral collateralization agreements. Deferred gains and losses from derivatives not accounted for as hedges and that are terminated are amortized over the shorter of the original remaining term of the derivative or the remaining life of the underlying asset or liability.
Comprehensive Income (Loss)	Comprehensive Income – Comprehensive income is the total of reported earnings for all other revenues, expenses, gains, and losses that are not reported in earnings under GAAP. The Company includes the following items, net of tax, in other comprehensive income in the Consolidated Statements of Comprehensive Income: (i) changes in unrealized gains or losses on securities available-for-sale, (ii) changes in unrealized gains or losses on securities held-to-maturity established upon transfer from securities available-for-sale and (iii) the effective portion of a derivative used to hedge cash flows. Accumulated other comprehensive income (loss) at December 31, 2018 and 2017, is comprised of unrealized losses on securities of $4.0 million and unrealized gains on securities of $2.2 million, respectively, and unrealized losses on a cash flow hedge of $41,000 and $760,000, respectively.
Recent Accounting Pronouncements	Recent Accounting Pronouncements – The following is a summary of recent accounting pronouncements that have impacted or could potentially affect the Company : In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09 “ Revenue from Contracts with Customers (Topic 606).” The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods and services. In August 2015, the FASB issued ASU 2015-14 “ Revenue from Contracts with Customers (Topic 606) Deferral of the Effective Date, ” which deferred the effective date of ASU 2014-09 for an additional year. ASU 2015-14 was effective for annual reporting periods beginning after December 15, 2017. The amendments could be applied retrospectively to each prior reporting period or retrospectively with the cumulative effect of initially applying this update recognized at the date of initial application. Early application was not permitted. In March 2016, the FASB issued ASU 2016-08 “ Revenue from Contracts with Customers (TOPIC 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net) ” and in April 2016, the FASB issued ASU 2016-10 “ Revenue from Contracts with Customers (TOPIC 606): Identifying Performance Obligations and Licensing.” ASU 2016-08 requires the entity to determine if it is acting as a principal with control over the goods or services it is contractually obligated to provide, or an agent with no control over specified goods or services provided by another party to a customer. ASU 2016-10 was issued to further clarify ASU 2014-09 implementation regarding identifying performance obligation materiality, identification of key contract components, and scope. The Company performed an analysis of the impact of adoption of this ASU, reviewing revenue recorded from service charges on deposit accounts, asset management fees, gains (losses) on other real estate owned, and debit card interchange fees. Certain revenue received, such as service charges on deposit accounts and interchange fees, is recorded immediately or as the service is performed. Asset management fees recorded by the Company take the form of wealth management income and brokerage income, and both types of fees are recorded after services are rendered, with no contractual requirement of refund to a customer based on non-achievement of fund performance objectives. Finally, the methodology used to record revenue from gains (losses) due to the sale of other real estate owned is not anticipated to change, as the Company currently records income or expense only upon consummation of the sale, and any revenue recorded stemming from seller financed transactions is reviewed for deferral, as appropriate. The Company adopted ASU 2014-09 and related issuances on January 1, 2018, with no cumulative effect adjustment to opening retained earnings required upon implementation of this standard. In January 2016, the FASB issued ASU No. 2016-01 “ Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities .” The objective of the issuance is to provide users of financial statements with more decision–useful information, by making targeted improvements to GAAP. These targeted improvements included revisions to the methodology of accounting for equity investments, eliminating certain disclosures on fair value assumptions for financial instruments measured at amortized cost, and requiring public business entities to use the exit price notion, as defined in ASC 820, for the measurement of the fair value of financial instruments. This standard was effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company adopted this standard as of January 1, 2018. Adoption of this standard resulted in the Company’s use of an exit price rather than an entrance price to determine the fair value of loans and deposits not already measured at fair value on a non-recurring basis in the consolidated balance sheet disclosures; see Note 19-Fair Value of Financial Instruments for further information regarding the valuation processes. In February 2016, the FASB issued ASU No. 2016-02 “ Leases (Topic 842) .” This ASU was issued to increase transparency and comparability among organizations by recognizing lease assets and liabilities on the balance sheet and disclosing key information about leasing arrangements. One key revision from prior guidance was to include operating leases within assets and liabilities recorded; another revision was to create a new model to follow for sale-leaseback transactions. The impact of this pronouncement will primarily affect lessees, as virtually all of their assets will be recognized on the balance sheet, by recording a right of use asset and lease liability. This pronouncement is effective for fiscal years beginning after December 15, 2018. In July 2018, the FASB issued ASU No. 2018-11, “Leases (Topic 842): Targeted Improvements ” which provided additional guidance on the transition method, including application as a cumulative-effect adjustment to equity and practical expedients to use when accounting for lease components. The Company has identified the population of all lease arrangements and upon analysis of those arrangements, management has determined there will not be a material impact to our financial position or regulatory capital. The implementation team is currently assessing the impact of the ASU on our ongoing processes, accounting, and internal controls over financial reporting. In June 2016, the FASB issued ASU No. 2016-13 “ Measurement of Credit Losses on Financial Instruments (Topic 326). ” ASU 2016-13 was issued to provide financial statement users with more useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date to enhance the decision making process. The new methodology to be used should reflect expected credit losses based on relevant vintage historical information, supported by reasonable forecasts of projected loss given defaults, which will affect the collectability of the reported amounts. This new methodology will also require available-for-sale debt securities to have a credit loss recorded through an allowance rather than write-downs. ASU 2016-13 is effective for financial statements issued for fiscal years beginning after December 15, 2019. The Company is assessing the impact of ASU 2016-13 on its accounting and disclosures, and has determined that a loss rate model will be used for calculation of future risk assessments upon the ASU’s adoption in 2020. The Company has accumulated historical data by loan pools and collateral classifications, and anticipates calculation of estimates for at least two quarters in 2019 on a test basis to confirm model processes and to determine financial statement impact prior to adoption in 2020. The Company is also developing internal control processes and disclosure documentation related to adoption of this standard. In March 2017, the FASB issued ASU No. 2017-08 “ Receivables-Nonrefundable Fees and Other Costs – Premium Amortization on Purchased Callable Debt Securities (Subtopic 310-20) .” This ASU was issued to shorten the amortization period for the premium to the earliest call date on debt securities. This premium is required to be recorded as a reduction to net interest margin during the shorter yield to call period, as compared to prior practice of amortizing the premium as a reduction to net interest margin over the contractual life of the instrument. This ASU does not change the current method of amortizing any discount over the contractual life of the debt security, and this pronouncement is effective for fiscal years beginning after December 15, 2018, with earlier adoption permitted. The Company adopted ASU 2017-08 as a change in accounting principle in the third quarter of 2017 on a modified retrospective basis, which required the Company to reflect its adoption effective January 1, 2017. The effect of amortizing the premium over a shorter period will continue to decrease future quarterly net interest income over the call period until the premium is fully amortized. As a result of management’s analysis, the impact of the change in accounting principle as a result of ASU 2017-08 to adjust beginning of year retained earnings was considered insignificant and, accordingly, the impact was adjusted through 2017 earnings. In August 2017, the FASB issued ASU No. 2017-12, “ Derivatives and Hedging: Targeted Improvements to Accounting for Hedging Activities”. The purpose of this updated guidance is to better align a company’s financial reporting for hedging activities with the economic objectives of those activities. ASU 2017-12 is effective for public business entities for fiscal years beginning after December 15, 2018, with early adoption, including adoption in an interim period, permitted. The Company adopted ASU 2017-12 on January 1, 2018, on a modified retrospective basis. FASB ASC 815, Derivatives and Hedging (“ASC 815”), provides the disclosure requirements for derivatives and hedging activities with the intent to provide users of financial statements with an enhanced understanding of: (a) how and why an entity uses derivative instruments, (b) how the entity accounts for derivative instruments and related hedged items, and (c) how derivative instruments and related hedged items affect an entity’s financial position, financial performance, and cash flows. Further, qualitative disclosures are required that explain the Company’s objectives and strategies for using derivatives, as well as quantitative disclosures about the fair value of and gains and losses on derivative instruments, and disclosures about credit-risk-related contingent features in derivative instruments. As required by ASC 815, the Company records all derivatives on the balance sheet at fair value. The accounting for changes in the fair value of derivatives depends on the intended use of the derivative, whether the Company has elected to designate a derivative in a hedging relationship and apply hedge accounting and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting. Derivatives designated and qualifying as a hedge of the exposure to changes in the fair value of an asset, liability, or firm commitment attributable to a particular risk, such as interest rate risk, are considered fair value hedges. Derivatives designated and qualifying as a hedge of the exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges. Derivatives may also be designated as hedges of the foreign currency exposure of a net investment in a foreign operation. Hedge accounting generally provides for the matching of the timing of gain or loss recognition on the hedging instrument with the recognition of the changes in the fair value of the hedged asset or liability that are attributable to the hedged risk in a fair value hedge or the earnings effect of the hedged forecasted transactions in a cash flow hedge. The Company may enter into derivative contracts that are intended to economically hedge certain of its risk, even though hedge accounting does not apply or the Company elects not to apply hedge accounting. In accordance with the FASB’s fair value measurement guidance in ASU 2011-04, the Company made an accounting policy election to measure the credit risk of its derivative financial instruments that are subject to master netting agreements on a net basis by counterparty portfolio. As the Company does not currently have any derivative financial instruments subject to master netting agreements, there was no impact to the balance sheet. In February 2018, the FASB issued ASU No. 2018-02, “ Income Statement-Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income .” This ASU was issued in response to the enactment of tax bill H.R.1 “Tax Cuts and Jobs Act”, which resulted in “stranding” the tax effects of items within accumulated other comprehensive income related to the adjustment of deferred taxes due to the reduction of the federal corporate income tax rate. The amendments proposed allow the reclassification of these stranded tax effects to retained earnings, and were effective for all entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption is permitted, and should be applied either in the period of adoption or retrospectively to each period in which the effect of the change in the U.S. federal corporate tax rate is recognized. The Company adopted ASU 2018-02 as of January 1, 2018, and a reclassification of $319,000, net, was recorded, which increased accumulated other comprehensive income and reduced retained earnings with the adoption of the accounting standard.
Subsequent Events	Subsequent Events On January 15, 2019, the Company’s Board of Directors declared a cash dividend of $0.01 per share payable on February 4, 2019, to stockholders of record as of January 25, 2019. On January 16, 2019, the warrant for 815,339 common shares of the Company’s stock was exercised in a cashless transaction. This warrant was issued in January 2009 at an exercise price of $13.43 per share, and expired on January 16, 2019. As of the date of exercise, the Company’s closing market price was $14.23 per share, resulting in 45,836 shares being issued. These shares were issued from treasury stock held by the Company, and resulted in a $313,000 reduction of treasury stock in January 2019.
Mortgage Banking Derivatives
Summary of Significant Accounting Policies
Derivative Financial Instruments	Mortgage Banking Derivatives – As part of the ongoing residential mortgage business, the Company enters into mortgage banking derivatives such as forward contracts and interest rate lock commitments. The derivatives and loans held-for-sale are carried at fair value with the changes in fair value recorded in current earnings. The net gain or loss on mortgage banking derivatives is included in net gains on sales of loans in the Consolidated Statements of Income .
Commercial
Summary of Significant Accounting Policies
Loans	Commercial Loans – Such credits typically comprise working capital loans, loans for physical asset expansion, asset acquisition loans and other commercial and industrial business loans. Loans to closely held businesses will generally be guaranteed in full or for a meaningful amount by the businesses’ major owners. Commercial loans are made based primarily on the historical and projected cash flow of the borrower and secondarily on the underlying collateral provided by the borrower. The cash flows of borrowers, however, may not behave as forecasted and collateral securing loans may fluctuate in value due to economic or individual performance factors. Minimum standards and underwriting guidelines have been established for all commercial loan types.
Real estate - commercial
Summary of Significant Accounting Policies
Loans	Lease Financing Receivables – Lease financing receivables are subject to underwriting standards and processes similar to commercial loans. These loans are often secured by equipment or transportation assets, and are made based primarily on the historical and projected cash flow of the borrower and secondarily on the underlying collateral provided by the borrower. The cash flows of borrowers, however, may not behave as forecasted and collateral securing loans may fluctuate in value due to economic or individual performance factors. Real Estate - Commercial Loans – Real estate - commercial loans are subject to underwriting standards and processes similar to commercial and industrial loans. These are loans secured by mortgages on real estate collateral. Commercial real estate loans are viewed primarily as cash flow loans and the repayment of these loans is largely dependent on the successful operation of the property. Loan performance may be adversely affected by factors impacting the general economy or conditions specific to the real estate market such as geographic location and/or property type.
Real estate - residential
Summary of Significant Accounting Policies
Loans	Real Estate - Residential Loans – These are loans that are extended to purchase or refinance 1-4 family residential dwellings, or to purchase or refinance vacant lots intended for the construction of a 1-4 family home. Residential real estate loans are considered homogenous in nature. Homes may be the primary or secondary residence of the borrower or may be investment properties of the borrower.
Consumer
Summary of Significant Accounting Policies
Loans	Home Equity Lines of Credit (“HELOCs”) – These are lines of credit that are extended to refinance 1-4 family residential dwellings, or to finance the borrower’s needs and collateralized by the borrower’s residence. These lines may be fixed or variable in nature, and the home serving as collateral may also have a first lien outstanding. Consumer Loans – Consumer loans include loans extended primarily for consumer and household purposes. These also include overdrafts and other items not captured by the definitions above.
Construction Loans | Real estate - commercial
Summary of Significant Accounting Policies
Loans	Real Estate - Construction Loans – The Company defines real estate - construction loans as loans where the loan proceeds are controlled by the Company and used exclusively for the improvement or development of real estate in which the Company holds a mortgage. Due to the inherent risk in this type of loan, they are subject to other industry specific policy guidelines outlined in the Company’s Credit Risk Policy and are monitored closely.

Acquisitions (Tables)

Acquisitions (Tables)	12 Months Ended
	Dec. 31, 2018
Acquisitions
Summary of acquisition	GCFC/ABC Bank Acquisition Summary As of Date of Acquisition April 20, 2018 Assets Cash and due from banks $ 6,669 Interest bearing deposits with financial institutions 500 Securities available-for-sale, at fair value 72,091 Federal funds sold 4,300 FHLBC stock 1,549 Loans 227,594 Premises and equipment 5,339 Other real estate owned 401 Goodwill and core deposit intangible 13,280 Deferred tax assets, net 3,459 Other assets 1,767 Total assets $ 336,949 Liabilities Noninterest bearing demand $ 58,005 Savings, NOW and money market 91,494 Time 98,999 Total deposits 248,498 Securities sold under repurchase agreements 5,623 Other short-term borrowings 10,875 Notes payable and other borrowings 23,367 Other liabilities 1,406 Total liabilities 289,769 Cash consideration paid 47,180 Total Liabilities Assumed and Cash Consideration Paid for Acquisition $ 336,949
Schedule of Acquired Loans as of Acquisition Date	April 20, 2018 December 31, 2018 ABC Bank Acquired Loans PCI Non-PCI PCI Non-PCI Fair Value $ 11,360 $ 216,234 $ 10,965 $ 171,520 Contractually required principal and interest payments 19,447 220,308 18,106 173,605 Best estimate of contractual cash flows not expected to be collected 6,537 2,511 5,969 1,175 Best estimate of contractual cash flows expected to be collected 12,910 217,797 12,137 172,430

Securities (Tables)

Securities (Tables)	12 Months Ended
	Dec. 31, 2018
Securities
Schedule of amortized cost and fair value of the securities portfolio and corresponding amounts of gross unrealized gains and losses recognized in accumulated other comprehensive loss	Gross Gross Amortized Unrealized Unrealized Fair December 31, 2018 Cost Gains Losses Value Securities available-for-sale U.S. Treasuries $ 4,006 $ - $ (83) $ 3,923 U.S. government agencies 11,112 - (161) 10,951 U.S. government agencies mortgage-backed 14,407 45 (377) 14,075 States and political subdivisions 277,112 1,916 (4,961) 274,067 Collateralized mortgage obligations 66,494 79 (2,144) 64,429 Asset-backed securities 108,574 1,165 (225) 109,514 Collateralized loan obligations 65,162 24 (897) 64,289 Total securities available-for-sale $ 546,867 $ 3,229 $ (8,848) $ 541,248 Gross Gross Amortized Unrealized Unrealized Fair December 31, 2017 Cost Gains Losses Value Securities available-for-sale U.S. Treasury $ 4,002 $ - $ (55) $ 3,947 U.S. government agencies 13,062 8 (9) 13,061 U.S. government agencies mortgage-backed 12,372 7 (165) 12,214 States and political subdivisions 272,240 7,116 (1,264) 278,092 Corporate bonds 823 21 (11) 833 Collateralized mortgage obligations 66,892 202 (1,155) 65,939 Asset-backed securities 113,983 862 (1,913) 112,932 Collateralized loan obligations 54,271 251 (101) 54,421 Total securities available-for-sale $ 537,645 $ 8,467 $ (4,673) $ 541,439
Schedule of fair value, amortized cost and weighted average yield of debt securities by contractual maturity along with securities not due at a single maturity date, primarily mortgage-backed securities (MBS), asset-backed securities, and collateralized loan obligations	Weighted Amortized Average Fair Securities available-for-sale Cost Yield Value Due in one year or less $ 494 0.56 % $ 495 Due after one year through five years 6,910 2.00 6,861 Due after five years through ten years 6,202 3.25 6,275 Due after ten years 278,624 3.02 275,310 292,230 2.99 288,941 Mortgage-backed and collateralized mortgage obligations 80,901 3.24 78,504 Asset-backed securities 108,574 3.65 109,514 Collateralized loan obligations 65,162 5.05 64,289 Total securities available-for-sale $ 546,867 3.41 % $ 541,248
Schedule of amortized cost and fair value of securities that exceed 10% of stockholders equity	December 31, 2018 Amortized Fair Issuer Cost Value GCO Education Loan Funding Corp $ 27,739 $ 27,763 Towd Point Mortgage Trust 34,308 33,318 Student Loan Marketing Association (“SLMA”) 25,808 26,119
Schedule of securities with unrealized losses aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position	Less than 12 months 12 months or more December 31, 2018 in an unrealized loss position in an unrealized loss position Total Number of Unrealized Fair Number of Unrealized Fair Number of Unrealized Fair Securities available-for-sale Securities Losses Value Securities Losses Value Securities Losses Value U.S. Treasuries - $ - $ - 1 $ 83 $ 3,923 1 $ 83 $ 3,923 U.S. government agencies 3 100 7,385 1 61 3,566 4 161 10,951 U.S. government agencies mortgage-backed - - - 11 377 11,439 11 377 11,439 States and political subdivisions 4 126 17,713 33 4,835 110,326 37 4,961 128,039 Collateralized mortgage obligations 2 309 15,211 10 1,835 43,687 12 2,144 58,898 Asset-backed securities - - - 4 225 16,473 4 225 16,473 Collateralized loan obligations 7 721 46,547 1 176 7,824 8 897 54,371 Total securities available-for-sale 16 $ 1,256 $ 86,856 61 $ 7,592 $ 197,238 77 $ 8,848 $ 284,094 Less than 12 months 12 months or more December 31, 2017 in an unrealized loss position in an unrealized loss position Total Number of Unrealized Fair Number of Unrealized Fair Number of Unrealized Fair Securities available-for-sale Securities Losses Value Securities Losses Value Securities Losses Value U.S. Treasuries 1 $ 55 $ 3,947 - $ - $ - 1 $ 55 $ 3,947 U.S. government agencies 2 9 6,550 - - - 2 9 6,550 U.S. government agencies mortgage-backed 4 24 5,501 5 141 4,843 9 165 10,344 States and political subdivisions 13 1,237 45,985 1 27 1,512 14 1,264 47,497 Corporate bonds - - - 1 11 332 1 11 332 Collateralized mortgage obligations 3 31 11,534 8 1,124 40,219 11 1,155 51,753 Asset-backed securities - - - 7 1,913 61,745 7 1,913 61,745 Collateralized loan obligations 3 101 29,313 - - - 3 101 29,313 Total securities available-for-sale 26 $ 1,457 $ 102,830 22 $ 3,216 $ 108,651 48 $ 4,673 $ 211,481
Schedule of proceeds from sale and gross realized gains and losses on sale of securities	Years ended December 31, Securities available-for-sale 2018 2017 2016 Proceeds from sales of securities $ 94,663 $ 232,462 $ 306,400 Gross realized gains on securities 369 2,367 1,675 Gross realized losses on securities (9) (1,893) (3,888) Securities realized gains (losses), net $ 360 $ 474 $ (2,213) Income tax (expense) benefit on net realized gains (losses) $ (100) $ (198) $ 882 Effective tax rate applied 27.8 % 41.8 % 39.9 %

Loans (Tables)

Loans (Tables)	12 Months Ended
	Dec. 31, 2018
Loans
Schedule of major classifications of loans	December 31, 2018 December 31, 2017 Commercial $ 314,323 $ 272,851 Leases 78,806 68,325 Real estate - commercial 820,941 750,991 Real estate - construction 108,390 85,162 Real estate - residential 407,068 313,397 HELOC 140,442 112,833 Other 1 14,439 13,383 Total loans, excluding deferred loan costs and PCI loans 1,884,409 1,616,942 Net deferred loan costs 1,653 680 Total loans, excluding PCI loans 1,886,062 1,617,622 PCI loans, net of purchase accounting adjustments 10,965 - Total loans $ 1,897,027 $ 1,617,622
Schedule of aged analysis of past due loans by class of loans	Aged analysis of past due loans by class of loans as of December 31, 2018, and December 31, 2017, were as follows: Recorded Investment 90 days or 90 Days or Greater Past 30-59 Days 60-89 Days Greater Past Total Past Due and December 31, 2018 Past Due Past Due Due Due Current Nonaccrual Total Loans Accruing Commercial $ 58 $ - $ 352 $ 410 $ 313,913 $ - $ 314,323 $ 361 Leases - - - - 78,806 - 78,806 - Real estate - commercial Owner occupied general purpose 1,768 - 33 1,801 160,892 1,579 164,272 36 Owner occupied special purpose 826 135 - 961 192,426 395 193,782 - Non-owner occupied general purpose 2,832 203 - 3,035 286,115 4,236 293,386 - Non-owner occupied special purpose - - - - 106,036 3,099 109,135 - Retail properties - 620 - 620 45,968 - 46,588 - Farm - - - - 13,778 - 13,778 - Real estate - construction Homebuilder - - - - 5,102 - 5,102 - Land 266 - - 266 2,478 - 2,744 - Commercial speculative - - 350 350 55,060 - 55,410 355 All other - - - - 45,028 106 45,134 - Real estate - residential Investor 801 156 - 957 69,148 353 70,458 - Multi-family 545 - 179 724 195,504 - 196,228 180 Owner occupied 1,241 705 - 1,946 135,360 3,076 140,382 - HELOC 775 - - 775 138,801 866 140,442 - Other 1 53 5 3 61 16,000 31 16,092 3 Total, excluding PCI loans $ 9,165 $ 1,824 $ 917 $ 11,906 $ 1,860,415 $ 13,741 $ 1,886,062 $ 935 PCI loans, net of purchase accounting adjustments 1,452 - - 1,452 7,248 2,265 10,965 - Total $ 10,617 $ 1,824 $ 917 $ 13,358 $ 1,867,663 $ 16,006 $ 1,897,027 $ 935 Recorded Investment 90 days or 90 Days or Greater Past 30-59 Days 60-89 Days Greater Past Total Past Due and December 31, 2017 Past Due Past Due Due Due Current Nonaccrual Total Loans Accruing Commercial $ 995 $ 275 $ - $ 1,270 $ 271,581 $ - $ 272,851 $ - Leases - - - - 68,147 178 68,325 - Real estate - commercial Owner occupied general purpose 1,136 - - 1,136 144,267 455 145,858 - Owner occupied special purpose 226 - - 226 170,546 342 171,114 - Non-owner occupied general purpose - 593 - 593 273,203 1,163 274,959 - Non-owner occupied special purpose - - 248 248 92,923 - 93,171 254 Retail properties - - - - 49,538 1,081 50,619 - Farm - - - - 15,270 - 15,270 - Real estate - construction Homebuilder 129 - - 129 2,221 - 2,350 - Land 1,124 - - 1,124 1,319 - 2,443 - Commercial speculative - - - - 32,028 - 32,028 - All other - - - - 48,140 201 48,341 - Real estate - residential Investor - - - - 55,248 372 55,620 - Multi-family - - - - 125,049 4,723 129,772 - Owner occupied 74 - - 74 123,257 4,674 128,005 - HELOC 491 278 - 769 110,872 1,192 112,833 - Other 1 37 - - 37 14,019 7 14,063 - Total $ 4,212 $ 1,146 $ 248 $ 5,606 $ 1,597,628 $ 14,388 $ 1,617,622 $ 254 1 The “Other” class includes consumer loans, overdrafts and net deferred costs.
Schedule of credit quality indicators by class of loans	December 31, 2018 Special Pass Mention Substandard 2 Doubtful Total Commercial $ 305,993 $ 8,193 $ 137 $ - $ 314,323 Leases 78,806 - - - 78,806 Real estate - commercial Owner occupied general purpose 157,334 1,660 5,278 - 164,272 Owner occupied special purpose 186,218 3,429 4,135 - 193,782 Non-owner occupied general purpose 284,818 202 8,366 - 293,386 Non-owner occupied special purpose 104,526 1,510 3,099 - 109,135 Retail Properties 44,805 - 1,783 - 46,588 Farm 11,307 1,249 1,222 - 13,778 Real estate - construction Homebuilder 5,102 - - - 5,102 Land 2,744 - - - 2,744 Commercial speculative 55,410 - - - 55,410 All other 42,524 - 2,610 - 45,134 Real estate - residential Investor 69,242 - 1,216 - 70,458 Multi-family 195,249 - 979 - 196,228 Owner occupied 135,858 - 4,524 - 140,382 HELOC 138,553 - 1,889 - 140,442 Other 1 16,061 - 31 - 16,092 Total, excluding PCI loans $ 1,834,550 $ 16,243 $ 35,269 $ - $ 1,886,062 PCI loans, net of purchase accounting adjustments 907 2,906 7,152 - 10,965 Total $ 1,835,457 $ 19,149 $ 42,421 $ - $ 1,897,027 December 31, 2017 Special Pass Mention Substandard 2 Doubtful Total Commercial $ 270,889 $ 1,962 $ - $ - $ 272,851 Leases 67,500 - 825 - 68,325 Real estate - commercial Owner occupied general purpose 142,843 1,927 1,088 - 145,858 Owner occupied special purpose 169,621 1,152 341 - 171,114 Non-owner occupied general purpose 271,731 2,065 1,163 - 274,959 Non-owner occupied special purpose 89,582 - 3,589 - 93,171 Retail Properties 48,321 1,217 1,081 - 50,619 Farm 11,755 1,029 2,486 - 15,270 Real estate - construction Homebuilder 2,350 - - - 2,350 Land 2,443 - - - 2,443 Commercial speculative 32,028 - - - 32,028 All other 46,913 1,052 376 - 48,341 Real estate - residential Investor 55,172 - 448 - 55,620 Multi-family 125,049 - 4,723 - 129,772 Owner occupied 122,178 561 5,266 - 128,005 HELOC 110,934 - 1,899 - 112,833 Other 1 14,043 - 20 - 14,063 Total $ 1,583,352 $ 10,965 $ 23,305 $ - $ 1,617,622 1 The “Other” class includes consumer, overdrafts and net deferred costs. 2 The substandard credit quality indicator includes both potential problem loans that are currently performing and nonperforming loans.
Schedule of impaired loans by class of loan	December 31, 2018 December 31, 2017 Unpaid Unpaid Recorded Principal Related Recorded Principal Related Investment Balance Allowance Investment Balance Allowance With no related allowance recorded Commercial $ - $ - $ - $ - $ - $ - Leases - - - 178 213 - Commercial real estate Owner occupied general purpose 1,659 1,782 - 455 495 - Owner occupied special purpose 395 530 - 342 498 - Non-owner occupied general purpose 1,138 1,159 - 1,163 1,538 - Non-owner occupied special purpose - - - - - - Retail properties - - - 1,081 1,177 - Farm - - - - - - Construction Homebuilder - - - - - - Land - - - - - - Commercial speculative - - - - - - All other 49 73 - 201 229 - Residential Investor 353 459 - 372 676 - Multi-family - - - 4,723 4,965 - Owner occupied 3,359 4,882 - 5,208 6,680 - HELOC 884 1,003 - 1,125 1,313 - Other 1 7 7 - 7 8 - Total impaired loans with no recorded allowance 7,844 9,895 - 14,855 17,792 - With an allowance recorded Commercial - - - - - - Leases - - - - - - Commercial real estate Owner occupied general purpose 396 396 3 - - - Owner occupied special purpose - - - - - - Non-owner occupied general purpose 3,098 4,038 97 - - - Non-owner occupied special purpose 3,099 3,575 139 - - - Retail properties - - - - - - Farm - - - - - - Construction Homebuilder - - - - - - Land - - - - - - Commercial speculative - - - - - - All other 57 58 1 - - - Residential Investor 808 808 4 829 829 10 Multi-family - - - - - - Owner occupied 3,676 3,679 46 3,443 3,443 43 HELOC 1,357 1,357 49 985 985 91 Other 1 24 25 13 - - - Total impaired loans with a recorded allowance 12,515 13,936 352 5,257 5,257 144 Total impaired loans $ 20,359 $ 23,831 $ 352 $ 20,112 $ 23,049 $ 144 1 The “Other” class includes consumer loans and overdraft. Average recorded investment and interest income recognized on impaired loans by class of loan for the years ending December 31 were as follows: Years Ended Years Ended Years Ended December 31, 2018 December 31, 2017 December 31, 2016 Average Interest Average Interest Average Interest Recorded Income Recorded Income Recorded Income Investment Recognized Investment Recognized Investment Recognized With no related allowance recorded Commercial $ - $ - $ 120 $ - $ 155 $ - Lease 89 - 272 - 183 - Commercial real estate Owner occupied general purpose 1,057 8 1,168 - 2,098 87 Owner occupied special purpose 369 - 364 - 574 - Non-owner occupied general purpose 1,150 - 1,453 - 1,395 2 Non-owner occupied special purpose - - 507 - 507 - Retail properties 541 - 1,130 - 589 - Farm - - - - 636 - Construction Homebuilder - - - - - - Land - - - - - - Commercial speculative - - 37 - 79 - All other 125 - 204 - 103 - Residential Investor 362 - 1,106 - 1,874 47 Multi-family 2,362 - 2,362 - - - Owner occupied 4,283 39 7,516 44 10,181 158 HELOC 1,005 1 1,804 1 2,608 29 Other 1 7 - 4 - - - Total impaired loans with no recorded allowance 11,350 48 18,047 45 20,982 323 With an allowance recorded Commercial - - - - 2 - Leases - - - - - - Commercial real estate Owner occupied general purpose 198 29 - - - - Owner occupied special purpose - - - - - - Non-owner occupied general purpose 1,549 - 123 - 123 - Non-owner occupied special purpose 1,549 - - - - - Retail properties - - - - - - Farm - - - - - - Construction Homebuilder - - - - - - Land - - - - - - Commercial speculative - - - - - - All other 29 - - - - - Residential Investor 818 43 414 43 - - Multi-family - - - - - - Owner occupied 3,560 150 2,123 123 457 - HELOC 1,171 56 493 35 23 - Other 1 12 - - - - - Total impaired loans with a recorded allowance 8,886 278 3,153 201 605 - Total impaired loans $ 20,236 $ 326 $ 21,200 $ 246 $ 21,587 $ 323
Schedule of TDRs modified during the period by type of modification	Loans that were modified during the period are summarized as follows: TDR Modifications Years Ended December 31, 2018 # of Pre-modification Post-modification contracts recorded investment recorded investment Troubled debt restructurings Real estate - commercial Owner occupied general purpose Other 1 1 $ 427 $ 396 Owner occupied special purpose Other 1 1 110 46 Real estate - construction All other Hamp 2 1 58 56 Real estate - residential Owner occupied HAMP 2 4 502 443 Other 1 1 34 29 HELOC HAMP 2 3 117 115 Rate 3 1 24 24 Other 1 9 622 600 Total 21 $ 1,894 $ 1,709 TDR Modifications Years Ended December 31, 2017 # of Pre-modification Post-modification contracts recorded investment recorded investment Troubled debt restructurings Real estate - commercial Other 1 1 $ 97 $ 131 Real estate - residential Owner occupied HAMP 2 184 189 Other 1 41 42 Revolving and junior liens HAMP 2 49 49 Other 1 6 319 350 Total 11 $ 690 $ 761 1 Other: Change of terms from bankruptcy court 2 HAMP: Home Affordable Modification Program
Schedule of accretable discount on purchased loans	Accretable Discount - Non-PCI Loans Accretable Discount - PCI Loans Non-Accretable Discount - PCI Loans Total Beginning balance, January 1, 2018 $ 835 $ - $ - $ 835 Purchases 3,182 1,551 6,536 11,269 Accretion (1,777) (424) (434) (2,635) Transfer 1 (373) (28) (133) (534) Ending balance, December 31, 2018 $ 1,867 $ 1,099 $ 5,969 $ 8,935
Schedule of loans to principal officers, directors, and their affiliates, made in the ordinary course of business	2018 2017 Beginning balance $ 1,524 $ 1,703 New loans 89 20 Repayments and other reductions (196) (199) Change in related party status - - Ending balance $ 1,417 $ 1,524

Allowance for Loan Losses (Tabl

Allowance for Loan Losses (Tables)	12 Months Ended
	Dec. 31, 2018
Allowance for Loan Losses
Schedule of changes in the allowance for loan losses by segment of loans based on method of impairment	Changes in the ALLL by segment of loans based on method of impairment for the year ended December 31, 2018, were as follows: Real Estate Real Estate Real Estate Allowance for loan and lease losses: Commercial Leases Commercial Construction Residential HELOC Other 1 Total Beginning balance $ 2,453 $ 692 $ 9,522 $ 923 $ 1,846 $ 1,446 $ 579 $ 17,461 Charge-offs 41 13 1,548 (16) (45) 147 409 2,097 Recoveries 157 - 447 35 1,146 364 265 2,414 Provision (Release) 263 55 2,049 (5) (1,106) (214) 186 1,228 Ending balance $ 2,832 $ 734 $ 10,470 $ 969 $ 1,931 $ 1,449 $ 621 $ 19,006 Ending balance: Individually evaluated for impairment $ - $ - $ 239 $ 1 $ 50 $ 49 $ 13 $ 352 Ending balance: Collectively evaluated for impairment 2,832 734 10,231 968 1,881 1,400 608 18,654 Ending balance: Acquired and accounted for ASC 310-30 - - - - - - - - Total ending allowance balance $ 2,832 $ 734 $ 10,470 $ 969 $ 1,931 $ 1,449 $ 621 $ 19,006 Loans: Ending balance: Individually evaluated for Impairment $ - $ - $ 9,785 $ 106 $ 8,196 $ 2,241 $ 31 $ 20,359 Ending balance: Collectively evaluated for impairment 314,323 78,806 811,156 108,284 398,872 138,201 16,061 1,865,703 Ending balance: Acquired and accounted for ASC 310-30 - - 4,182 745 6,038 - - 10,965 Total ending loans balance $ 314,323 $ 78,806 $ 825,123 $ 109,135 $ 413,106 $ 140,442 $ 16,092 $ 1,897,027 Changes in the ALLL by segment of loans based on method of impairment for the year ended December 31, 2017, were as follows: Real Estate Real Estate Real Estate Allowance for loan and lease losses: Commercial Leases Commercial Construction Residential HELOC Other 1 Total Beginning balance $ 1,629 $ 633 $ 9,547 $ 389 $ 2,178 $ 1,331 $ 451 $ 16,158 Charge-offs 25 215 309 23 1,347 386 1 2,306 Recoveries 30 - 161 377 980 243 18 1,809 Provision (Release) 819 274 123 180 35 258 111 1,800 Ending balance $ 2,453 $ 692 $ 9,522 $ 923 $ 1,846 $ 1,446 $ 579 $ 17,461 Ending balance: Individually evaluated for impairment $ - $ - $ - $ - $ 53 $ 91 $ - $ 144 Ending balance: Collectively evaluated for impairment 2,453 692 9,522 923 1,793 1,355 579 17,317 Total ending allowance balance $ 2,453 $ 692 $ 9,522 $ 923 $ 1,846 $ 1,446 $ 579 $ 17,461 Loans: Ending balance: Individually evaluated for impairment $ - $ 178 $ 3,041 $ 201 $ 14,575 $ 2,110 $ 7 $ 20,112 Ending balance: Collectively evaluated for impairment 272,851 68,147 747,950 84,961 298,822 110,723 14,056 1,597,510 Total ending loan balance $ 272,851 $ 68,325 $ 750,991 $ 85,162 $ 313,397 $ 112,833 $ 14,063 $ 1,617,622 Changes in the ALLL by segment of loans based on method of impairment for the year ended December 31, 2016, were as follows: Real Estate Real Estate Real Estate Allowance for loan and lease losses: Commercial Leases Commercial Construction Residential HELOC Other 1 Total Beginning balance $ 1,463 $ 633 $ 9,013 $ 265 $ 724 $ 2,050 $ 2,075 $ 16,223 Charge-offs 95 23 1,633 23 450 622 344 3,190 Recoveries 32 5 640 96 486 845 271 2,375 Provision (Release) 229 18 1,527 51 1,418 (942) (1,551) 750 Ending balance $ 1,629 $ 633 $ 9,547 $ 389 $ 2,178 $ 1,331 $ 451 $ 16,158 Ending balance: Individually evaluated for impairment $ - $ - $ 246 $ - $ 803 $ - $ - $ 1,049 Ending balance: Collectively evaluated for impairment 1,629 633 9,301 389 1,375 1,331 451 15,109 Total ending allowance balance $ 1,629 $ 633 $ 9,547 $ 389 $ 2,178 $ 1,331 $ 451 $ 16,158 Loans: Ending balance: Individually evaluated for impairment $ 240 $ 366 $ 6,448 $ 281 $ 12,468 $ 2,484 $ - $ 22,287 Ending balance: Collectively evaluated for impairment 227,873 55,085 729,799 64,439 263,757 99,142 16,427 1,456,522 Total ending loan balance $ 228,113 $ 55,451 $ 736,247 $ 64,720 $ 276,225 $ 101,626 $ 16,427 $ 1,478,809 1 The “Other” class includes consumer loans, overdrafts and net deferred costs.

Other Real Estate Owned (Tables

Other Real Estate Owned (Tables)	12 Months Ended
	Dec. 31, 2018
Other Real Estate Owned
Schedule of activity in the other real estate owned (OREO) portfolio, net of valuation reserve	Years Ended December 31, Other real estate owned 2018 2017 2016 Balance at beginning of period $ 8,371 $ 11,916 $ 19,141 Property additions, net of acquisition adjustments 3,316 3,796 1,785 Property improvements 59 - 16 Less: Proceeds from property disposals, net of participation purchase and of gains/losses 3,990 5,633 7,456 Period valuation adjustments 581 1,708 1,570 Balance at end of period $ 7,175 $ 8,371 $ 11,916
Schedule of activity in valuation allowance	Years Ended December 31, 2018 2017 2016 Balance at beginning of period $ 8,208 $ 9,982 $ 14,127 Provision for unrealized losses 581 1,708 1,570 Reductions taken on sales (762) (3,482) (5,867) Other adjustments - - 152 Balance at end of period $ 8,027 $ 8,208 $ 9,982
Schedule of expenses related to foreclosed assets, net of lease revenue	Years Ended December 31, 2018 2017 2016 Gain on sales, net $ (792) $ (474) $ (374) Provision for unrealized losses 581 1,708 1,570 Operating expenses 649 1,227 1,765 Less: Lease revenue 42 296 218 Net OREO expense $ 396 $ 2,165 $ 2,743

Premises and Equipment (Tables)

Premises and Equipment (Tables)	12 Months Ended
	Dec. 31, 2018
Premises and Equipment
Schedule of components of premises and equipment	2018 2017 Accumulated Accumulated Depreciation/ Net Book Depreciation/ Net Book Cost Amortization Value Cost Amortization Value Land $ 18,501 $ - $ 18,501 $ 16,124 $ - $ 16,124 Buildings 43,376 23,913 19,463 41,499 22,935 18,564 Leasehold improvements 710 246 464 156 144 12 Furniture and equipment 45,258 41,247 4,011 42,910 39,982 2,928 Total Premises and Equipment $ 107,845 $ 65,406 $ 42,439 $ 100,689 $ 63,061 $ 37,628

Deposits (Tables)

Deposits (Tables)	12 Months Ended
	Dec. 31, 2018
Deposits
Schedule of major classifications of deposits	December 31, 2018 December 31, 2017 Noninterest bearing demand $ 618,830 $ 572,404 Savings 304,400 262,220 NOW accounts 425,878 429,448 Money market accounts 310,390 276,082 Certificates of deposit of less than $100,000 230,781 216,493 Certificates of deposit of $100,000 through $250,000 159,953 122,489 Certificates of deposit of more than $250,000 66,441 43,789 Total deposits $ 2,116,673 $ 1,922,925
Summary of scheduled maturities of time deposits	2019 $ 276,349 2020 124,857 2021 38,036 2022 8,206 2023 9,727 Total time deposits $ 457,175

Borrowings (Tables)

Borrowings (Tables)	12 Months Ended
	Dec. 31, 2018
Borrowings
Summary of borrowings and junior subordinated debentures	December 31, 2018 December 31, 2017 Securities sold under repurchase agreements $ 46,632 $ 29,918 Other short-term borrowings 1 149,500 115,000 Junior subordinated debentures 2 57,686 57,639 Senior notes 44,158 44,058 Notes payable and other borrowings 15,379 - Total borrowings $ 313,355 $ 246,615
Summary of scheduled maturities and weighted average rates of borrowings	2018 2017 Weighted Weighted Average Average Balance Rate Balance Rate 2018 N/A N/A $ 144,918 0.86 % 2019 $ 196,132 1.78 % - - 2020 8,500 2.05 - - 2021 - - - - 2022 - - - - 2023 - - - - Thereafter 108,723 6.07 101,697 6.01 Total borrowings $ 313,355 3.28 % $ 246,615 2.98 %

Income Taxes (Tables)

Income Taxes (Tables)	12 Months Ended
	Dec. 31, 2018
Income Taxes
Schedule of components of income tax expense (benefit)	December 31, 2018 December 31, 2017 December 31, 2016 Current federal $ - $ (2,407) $ 399 Current state 84 - - Deferred federal 6,226 11,724 6,824 Deferred state 3,614 372 1,597 Expense due to enactment of federal tax reform - 9,475 - Total income tax expenses $ 9,924 $ 19,164 $ 8,820
Schedule of components of deferred tax assets and liabilities	December 31, 2018 December 31, 2017 Allowance for loan and lease losses $ 5,803 $ 5,377 Deferred compensation 665 650 Amortization of core deposit intangible - 827 Goodwill amortization/impairment 4,698 6,087 Stock based compensation 1,377 866 Business combination adjustments 2,532 - OREO write-downs 2,337 2,385 Federal net operating loss (“NOL”) carryforward 2,199 7,240 State net operating loss (“NOL”) carryforward 4,034 7,020 Other assets 1,401 1,017 Total deferred tax assets 25,046 31,469 Accumulated depreciation on premises and equipment (443) (384) Mortgage servicing rights (2,210) (2,086) Amortization of core deposit intangible (130) - State tax benefits (1,839) (2,389) Other liabilities (741) (545) Total deferred tax liabilities (5,363) (5,404) Net deferred tax asset before adjustments related to other comprehensive income 19,683 26,065 Tax effect of adjustments related to other comprehensive income (loss) 1,597 (709) Net deferred tax asset $ 21,280 $ 25,356
Schedule of components of provision for deferred income taxes	December 31, 2018 December 31, 2017 December 31, 2016 Provision for loan and lease losses $ (426) $ 1,680 $ 42 Deferred Compensation (15) 85 (45) Amortization of core deposit intangible 957 574 228 Stock based compensation (511) 80 (132) Business combination adjustments 927 - - OREO write-downs 48 2,725 1,807 Federal net operating loss carryforward 5,041 12,122 4,743 State net operating loss carryforward 2,986 715 1,011 Deferred tax credit - 2,058 (309) Depreciation 59 (297) 80 Mortgage servicing rights 124 (674) 276 Goodwill amortization/impairment 1,389 4,040 1,496 State tax benefits (550) (1,738) (559) Other, net (189) 201 (217) Total deferred tax expense $ 9,840 $ 21,571 $ 8,421
Schedule of difference between effective tax rates from federal statutory rates	Effective tax rates differ from federal statutory rates applied to financial statement income for the years ended December 31 due to the following: December 31, 2018 December 31, 2017 December 31, 2016 Tax at statutory federal income tax rate $ 9,227 $ 11,817 $ 8,577 Nontaxable interest income, net of disallowed interest deduction (1,600) (1,976) (347) BOLI income (422) (501) (449) State income taxes, net of federal benefit 2,927 1,775 1,148 Stock based compensation (305) - - Impact of Federal tax rate change - 9,475 - Impact of Illinois tax rate change - (1,566) - Other, net 97 140 (109) Total tax at effective tax rate $ 9,924 $ 19,164 $ 8,820

Equity Compensation Plans (Tabl

Equity Compensation Plans (Tables)	12 Months Ended
	Dec. 31, 2018
Equity Compensation Plans
Summary of stock option activity in Incentive Plan	A summary of stock option activity in the Plans for the years ending December 31, 2018, is as follows: Weighted- Weighted Average Average Remaining Exercise Price Contractual Aggregate Shares per Share Term (years) Intrinsic Value Beginning outstanding 9,000 $ 7.49 1.1 $ 55 Canceled - - - - Exercised (4,500) 7.49 - (27) Expired - - - - Ending outstanding 4,500 $ 7.49 0.1 $ 25 Exercisable at end of period 4,500 $ 7.49 0.1 $ 25
Summary of stock option activity as of each year	A summary of stock option activity as of each year is as follows: 2018 2017 2016 Intrinsic value of options exercised $ 27 $ - $ 3 Cash received from option exercises 33 - 11 Tax benefit realized from option exercises 5 - - Weighted average fair value of options granted - - -
Summary of changes in nonvested shares of restricted share rights	December 31, 2018 Weighted Restricted Average Stock Shares Grant Date and Units Fair Value Unvested at January 1 465,000 $ 7.79 Granted 254,281 13.98 Vested (167,000) 5.60 Forfeited - - Unvested at December 31 552,281 $ 11.31

Earnings Per Share (Tables)

Earnings Per Share (Tables)	12 Months Ended
	Dec. 31, 2018
Earnings Per Share
Schedule of Earnings Per Share	The earnings per share, both basic and diluted, are included below as of December 31 (in thousands except for share data): 2018 2017 2016 Basic earnings per share: Weighted-average common shares outstanding 29,728,308 29,600,702 29,532,510 Net income $ 34,012 $ 15,138 $ 15,684 Basic earnings per share $ 1.14 $ 0.51 $ 0.53 Diluted earnings per share: Weighted-average common shares outstanding 29,728,308 29,600,702 29,532,510 Dilutive effect of unvested restricted awards 1 532,692 435,142 305,678 Dilutive effect of stock options and warrants 47,935 2,573 743 Diluted average common shares outstanding 30,308,935 30,038,417 Net Income $ 34,012 $ 15,138 $ 15,684 Diluted earnings per share $ 1.12 $ 0.50 $ 0.53 Number of antidilutive options and warrants excluded from the diluted earnings per share calculation - 815,339 900,839 1 Includes the common stock equivalents for restricted share rights that are dilutive.

Commitments (Tables)

Commitments (Tables)	12 Months Ended
	Dec. 31, 2018
Commitments
Schedule of contractual commitments due to letters of credit	The following table is a summary of financial instrument commitments: December 31, 2018 December 31, 2017 Fixed Variable Total Fixed Variable Total Letters of credit: Borrower: Financial standby $ 327 $ 7,158 $ 7,485 $ 177 $ 3,770 $ 3,947 Commercial standby - 397 397 - 354 354 Performance standby 532 6,381 6,913 241 7,594 7,835 859 13,936 14,795 418 11,718 12,136 Non-borrower: Performance standby - 67 67 - 142 142 Total letters of credit $ 859 $ 14,003 $ 14,862 $ 418 $ 11,860 $ 12,278 Unused loan commitments: $ 89,303 $ 297,785 $ 387,088 $ 82,942 $ 260,061 $ 343,003
Schedule of aggregate minimum annual rental commitments	2019 2020 2021 2022 2023 2024 Rental commitment $ 534 $ 478 $ 482 $ 368 $ 336 $ 346

Regulatory & Capital Matters (T

Regulatory & Capital Matters (Tables)	12 Months Ended
	Dec. 31, 2018
Regulatory & Capital Matters
Schedule of capital levels and industry defined regulatory minimum required levels	Minimum Capital To Be Well Capitalized Under Adequacy with Capital Prompt Corrective Actual Conservation Buffer if applicable 1 Action Provisions 2 Amount Ratio Amount Ratio Amount Ratio December 31, 2018 Common equity tier 1 capital to risk weighted assets Consolidated $ 207,597 9.29 % $ 142,444 6.375 % N/A N/A Old Second Bank 295,599 13.29 141,791 6.375 $ 144,571 6.50 % Total capital to risk weighted assets Consolidated 282,126 12.63 220,648 9.875 N/A N/A Old Second Bank 314,600 14.14 219,637 9.875 222,417 10.00 Tier 1 capital to risk weighted assets Consolidated 263,125 11.78 175,960 7.875 N/A N/A Old Second Bank 295,599 13.29 175,153 7.875 177,934 8.00 Tier 1 capital to average assets Consolidated 263,125 10.08 104,415 4.00 N/A N/A Old Second Bank 295,599 11.36 104,084 4.00 130,105 5.00 December 31, 2017 Common equity tier 1 capital to risk weighted assets Consolidated $ 179,853 9.25 % $ 111,801 5.750 % N/A N/A Old Second Bank 249,417 12.88 111,347 5.750 $ 125,870 6.50 % Total capital to risk weighted assets Consolidated 251,383 12.93 179,837 9.250 N/A N/A Old Second Bank 266,873 13.78 179,142 9.250 193,667 10.00 Tier 1 capital to risk weighted assets Consolidated 233,927 12.03 140,978 7.250 N/A N/A Old Second Bank 249,417 12.88 140,394 7.250 154,917 8.00 Tier 1 capital to average assets Consolidated 233,927 10.08 92,828 4.00 N/A N/A Old Second Bank 249,417 10.79 92,462 4.00 115,578 5.00 1 As of December 31, 2018, amounts shown are inclusive of a capital conservation buffer of 1.875% as compared to December 31, 2017, of 1.25%. 2 The Bank exceeded the general minimum regulatory requirements to be considered “well capitalized” .

Mortgage Banking Derivatives (T

Mortgage Banking Derivatives (Tables)	12 Months Ended
	Dec. 31, 2018
Not designated | Mortgage Banking Derivatives
Mortgage Banking Derivatives
Schedule of net gain or loss recorded on derivative activity	These mortgage banking derivatives are not designated in hedge relationships using the accepted accounting for derivative instruments and hedging activities at December 31: 2018 2017 Forward contracts: Notional amount $ 9,315 $ 16,500 Fair value (50) 3 Rate lock commitments: Notional amount $ 8,815 $ 10,478 Fair value 209 235

Fair Value Measurements (Tables

Fair Value Measurements (Tables)	12 Months Ended
	Dec. 31, 2018
Fair Value Measurements
Schedule of balance of assets and liabilities which are measured at fair value on a recurring basis	December 31, 2018 Level 1 Level 2 Level 3 Total Assets: Securities available-for-sale U.S. Treasury $ 3,923 $ - $ - $ 3,923 U.S. government agencies - 10,951 - 10,951 U.S. government agencies mortgage-backed - 14,075 - 14,075 States and political subdivisions - 265,902 8,165 274,067 Collateralized mortgage obligations - 64,429 - 64,429 Asset-backed securities - 109,514 - 109,514 Collateralized loan obligations - 64,289 - 64,289 Loans held-for-sale - 2,984 - 2,984 Mortgage servicing rights - - 7,357 7,357 Interest rate swap agreements - 672 - 672 Mortgage banking derivatives - 159 - 159 Total $ 3,923 $ 532,975 $ 15,522 $ 552,420 Liabilities: Interest rate swap agreements $ - $ 672 $ - $ 672 Total $ - $ 672 $ - $ 672 December 31, 2017 Level 1 Level 2 Level 3 Total Assets: Securities available-for-sale U.S. Treasury $ 3,947 $ - $ - $ 3,947 U.S. government agencies - 13,061 - 13,061 U.S. government agencies mortgage-backed - 12,214 - 12,214 States and political subdivisions - 263,831 14,261 278,092 Corporate bonds - 833 - 833 Collateralized mortgage obligations - 63,671 2,268 65,939 Asset-backed securities - 112,932 - 112,932 Collateralized loan obligations - 54,421 - 54,421 Loans held-for-sale - 4,067 - 4,067 Mortgage servicing rights - - 6,944 6,944 Interest rate swap agreements - 727 - 727 Mortgage banking derivatives - 238 - 238 Total $ 3,947 $ 525,995 $ 23,473 $ 553,415 Liabilities: Interest rate swap agreements $ - $ 2,014 $ - $ 2,014 Total $ - $ 2,014 $ - $ 2,014
Schedule of changes in Level 3 assets and liabilities measured at fair value on a recurring basis	Years Ended December 31, 2018 Securities available-for-sale Collateralized States and Mortgage Mortgage Political Servicing Obligation Subdivisions Rights Beginning balance January 1, 2018 $ 2,268 $ 14,261 $ 6,944 Transfers into Level 3 - - - Transfers out of Level 3 (1,308) - - Total gains or losses Included in earnings 35 - (181) Included in other comprehensive income 40 (746) - Purchases, issuances, sales, and settlements Purchases - 22,046 - Issuances - - 1,146 Settlements (1,035) (27,396) (552) Ending balance December 31, 2018 $ - $ 8,165 $ 7,357 Years Ended December 31, 2017 Securities available-for-sale Collateralized States and Mortgage Mortgage Political Servicing Obligation Subdivisions Rights Beginning balance January 1, 2017 $ 3,119 $ 22,226 $ 6,489 Transfers into Level 3 - - - Transfers out of Level 3 - - - Total gains or losses Included in earnings 40 - (270) Included in other comprehensive income 21 (796) - Purchases, issuances, sales, and settlements Purchases - 16,712 - Issuances - - 1,257 Settlements (912) (23,881) (532) Ending balance December 31, 2017 $ 2,268 $ 14,261 $ 6,944
Schedule of quantitative information about level 3 fair value measurements	The following table and commentary presents quantitative and qualitative information about Level 3 fair value measurements as of December 31, 2018: Weighted Measured at fair value Unobservable Average on a recurring basis: Fair Value Valuation Methodology Inputs Range of Input of Inputs Mortgage servicing rights $ 7,357 Discounted Cash Flow Discount Rate 10.0 - 229.7% 10.2 % Prepayment Speed 7.0 - 68.9% 9.6 % The following table and commentary presents quantitative and qualitative information about Level 3 fair value measurements as of December 31, 2017: Weighted Measured at fair value Unobservable Average on a recurring basis: Fair Value Valuation Methodology Inputs Range of Input of Inputs Mortgage servicing rights $ 6,944 Discounted Cash Flow Discount Rate 10.0 - 34.3% 10.2 % Prepayment Speed 7.0 - 68.4% 9.6 %
Schedule of assets measured at fair value on a nonrecurring basis	For assets measured at fair value on a nonrecurring basis at December 31, 2018, and December 31, 2017, the following tables provide the level of valuation assumptions used to determine each valuation and the carrying value of the related assets: December 31, 2018 Level 1 Level 2 Level 3 Total Impaired loans 1 $ - $ - $ 12,163 $ 12,163 Other real estate owned, net 2 - - 7,175 7,175 Total $ - $ - $ 19,338 $ 19,338 1 Represents carrying value and related write-downs of loans for which adjustments are substantially based on the appraised value of collateral for collateral-dependent loans, had a carrying amount of $12.5 million and a valuation allowance of $352,000, resulting in an increase of specific allocations within the provision for loan and lease losses of $208,000 for the year ending December 31, 2018. 2 OREO is measured at the lower of carrying or fair value less costs to sell, and had a net carrying amount of $7.2 million, which is made up of the outstanding balance of $16.1 million, net of a valuation allowance of $8.0 million and participations of $900,000, at December 31, 2018. December 31, 2017 Level 1 Level 2 Level 3 Total Impaired loans 1 $ - $ - $ 5,113 $ 5,113 Other real estate owned, net 2 - - 8,371 8,371 Total $ - $ - $ 13,484 $ 13,484 1 Represents carrying value and related write-downs of loans for which adjustments are substantially based on the appraised value of collateral for collateral-dependent loans, had a carrying amount of $5.3 million and a valuation allowance of $144,000, resulting in an increase of specific allocations within the provision for loan and lease losses of $856,000 for the year ending December 31, 2017. 2 OREO is measured at the lower of carrying or fair value less costs to sell, and had a net carrying amount of $8.4 million, which is made up of the outstanding balance of $17.4 million, net of a valuation allowance of $8.2 million and participations of $900,000, at December 31, 2017.

Fair Values of Financial Inst_2

Fair Values of Financial Instruments (Tables)	12 Months Ended
	Dec. 31, 2018
Fair Values of Financial Instruments
Schedule of carrying amount and estimated fair values of financial instruments	December 31, 2018 Carrying Fair Amount Value Level 1 Level 2 Level 3 Financial assets: Cash and due from banks $ 38,599 $ 38,599 $ 38,599 $ - $ - Interest bearing deposits with financial institutions 16,636 16,636 16,636 - - Securities available-for-sale 541,248 541,248 3,923 529,160 8,165 FHLBC and FRBC Stock 13,433 13,433 - 13,433 - Loans held-for-sale 2,984 2,984 - 2,984 - Net loans 1,878,021 1,867,594 - - 1,867,594 Accrued interest receivable 10,940 10,940 - 10,940 - Financial liabilities: Noninterest bearing deposits $ 618,830 $ 618,830 $ 618,830 $ - $ - Interest bearing deposits 1,497,843 1,495,614 - 1,495,614 - Securities sold under repurchase agreements 46,632 46,632 - 46,632 - Other short-term borrowings 149,500 149,500 - 149,500 - Junior subordinated debentures 57,686 47,625 32,989 14,636 - Senior notes 44,158 45,008 45,008 - - Note payable and other borrowings 15,379 18,050 - 18,050 - Interest rate swap agreements 58 58 - 58 - Borrowing interest payable 281 281 - 281 - Deposit interest payable 973 973 - 973 - December 31, 2017 Carrying Fair Amount Value Level 1 Level 2 Level 3 Financial assets: Cash and due from banks $ 37,444 $ 37,444 $ 37,444 $ - $ - Interest bearing deposits with financial institutions 18,389 18,389 18,389 - - Securities available-for-sale 541,439 541,439 3,947 520,963 16,529 FHLBC and FRBC Stock 10,168 10,168 - 10,168 - Loans held-for-sale 4,067 4,067 - 4,067 - Net loans 1,600,161 1,586,722 - - 1,586,722 Accrued interest receivable 8,595 8,595 - 8,595 - Financial liabilities: Noninterest bearing deposits $ 572,404 $ 572,404 $ 572,404 $ - $ - Interest bearing deposits 1,350,521 1,346,339 - 1,346,339 - Securities sold under repurchase agreements 29,918 29,918 - 29,918 - Other short-term borrowings 115,000 115,000 - 115,000 - Junior subordinated debentures 57,639 59,471 33,267 26,204 - Senior notes 44,058 46,743 46,743 - - Interest rate swap agreements 1,287 1,287 - 1,287 - Borrowing interest payable 140 140 - 140 - Deposit interest payable 631 631 - 631 -

Financial Instruments with Of_2

Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions (Tables)	12 Months Ended
	Dec. 31, 2018
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions
Schedule of fair value of derivative financial instruments as well as their classification on the Balance Sheet	December 31, 2018 No. of Trans. Notional Amount $ Balance Sheet Location Fair Value $ Balance Sheet Location Fair Value $ Derivatives designated as hedging instruments Interest rate swaps 25,774 Other Assets - Other Liabilities 58 Total derivatives designated as hedging instruments - 58 Derivatives not designated as hedging instruments Interest rate swaps with commercial loan customers 188,931 Other Assets 672 Other Liabilities 672 Interest rate lock commitments and forward contracts 18,130 Other Assets 159 Other Liabilities - Other contracts 18,155 Other Assets - Other Liabilities 26 Total derivatives not designated as hedging instruments 831 698 December 31, 2017 No. of Trans. Notional Amount $ Balance Sheet Location Fair Value $ Balance Sheet Location Fair Value $ Derivatives designated as hedging instruments Interest rate swaps 25,774 Other Assets - Other Liabilities 1,287 Total derivatives designated as hedging instruments - 1,287 Derivatives not designated as hedging instruments Interest rate swaps with commercial loan customers 153,433 Other Assets 727 Other Liabilities 727 Interest rate lock commitments and forward contracts 26,978 Other Assets 238 Other Liabilities - Other contracts 15,959 Other Assets - Other Liabilities 13 Total derivatives not designated as hedging instruments 965 740

Parent Company Condensed Fina_2

Parent Company Condensed Financial Information (Tables)	12 Months Ended
	Dec. 31, 2018
Parent Company Condensed Financial Information
Schedule of condensed balance sheets	2018 2017 Assets Noninterest bearing deposit with bank subsidiary $ 9,039 $ 23,011 Investment in subsidiaries 315,252 263,389 Other assets 12,997 17,139 Total assets $ 337,288 $ 303,539 Liabilities and Stockholders’ Equity Other short term borrowings $ 4,000 $ - Junior subordinated debentures 57,686 57,639 Senior notes 44,158 44,058 Other liabilities 2,363 1,492 Stockholders’ equity 229,081 200,350 Total liabilities and stockholders' equity $ 337,288 $ 303,539
Schedule of condensed statements of operations	2018 2017 2016 Operating Income Cash dividends received from subsidiaries $ 30,000 $ - $ - Other income 106 114 130 Total operating income 30,106 114 130 Operating Expenses Junior subordinated debentures 3,716 4,002 4,334 Senior notes 2,688 2,689 112 Subordinated debt - - 949 Other interest expense 98 - 8 Other expenses 4,208 2,639 1,975 Total operating expense 10,710 9,330 7,378 Income (loss) before income taxes and equity in undistributed net income of subsidiaries 19,396 (9,216) (7,248) Income tax benefit (3,355) (16) (2,909) Income (loss) before equity in undistributed net income of subsidiaries 22,751 (9,200) (4,339) Equity in undistributed net income of subsidiaries 11,261 24,338 20,023 Net income available to common stockholders $ 34,012 $ 15,138 $ 15,684
Schedule of condensed statements of cash Flows	2018 2017 2016 Cash Flows from Operating Activities Net Income $ 34,012 $ 15,138 $ 15,684 Adjustments to reconcile net income to net cash from operating activities: Equity in undistributed net income of subsidiaries (11,261) (24,338) (20,023) Provision for deferred tax expense (benefit) 6,697 6,397 (1,039) Net deferred tax expense due to DTA revaluation - 3,908 - Change in taxes payable (1,211) (4,797) 330 Change in other assets 97 74 171 Stock-based compensation 2,257 1,181 657 Other, net 172 (15) 282 Net cash (used in) provided by operating activities 30,763 (2,452) (3,938) Cash Flows from Investing Activities Cash paid for acquisition, net of cash and cash equivalents retained (47,074) - - Net cash (used in) investing activities (47,074) - - Cash Flows from Financing Activities Net change in other short-term borrowings 4,000 Dividend paid on common stock (1,189) (1,184) (888) Purchases of treasury stock (505) (236) (254) Proceeds from the issuance of senior notes - - 43,994 Payment of senior note issuance costs - (42) - Repayment of subordinated debt - - (45,000) Repayment of note payable - - (500) Proceeds from exercise of stock (option) 33 - 11 Net cash provided by (used in) financing activities 2,339 (1,462) (2,637) Net change in cash and cash equivalents (13,972) (3,914) (6,575) Cash and cash equivalents at beginning of year 23,011 26,925 33,500 Cash and cash equivalents at end of year $ 9,039 $ 23,011 $ 26,925

Summary of Significant Accoun_3

Summary of Significant Accounting Policies - Accounting Pronouncements (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Net interest income	$ 107,617	$ 87,505	$ 73,379
Net income	$ 34,012	$ 15,138	$ 15,684
Diluted earnings per share (in dollars per share)	$ 1.12	$ 0.50	$ 0.53
Old Second Bancorp, Inc.
Net income	$ 34,012	$ 15,138	$ 15,684

Summary of Significant Accoun_4

Summary of Significant Accounting Policies - Dividend (Details) - USD ($)	Jan. 16, 2019	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Jan. 15, 2019
90-Days or Greater Past Due Loans
Period from due date after which accrual of interest income is discontinued		90 days
Accumulated other comprehensive income (loss) breakdown
Unrealized gains on securities		$ 4,000,000
Unrealized losses on securities			$ 2,200,000
Unrealized Loss on Price Risk Cash Flow Derivatives, before Tax		41,000	760,000
Goodwill and Core Deposit Intangible
Impairment of goodwill		0
Amortization of core deposit intangible		387,000	96,000	$ 16,000
Core Deposit Intangible
Goodwill and Core Deposit Intangible
Amortization of core deposit intangible		387,000
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract]
Estimated future amortization expense for the core deposit intangible for the year ending December 31, 2020		483,000
Estimated future amortization expense for the core deposit intangible for the year ending December 31, 2021		416,000
Estimated future amortization expense for the core deposit intangible for the year ending December 31, 2022		380,000
Estimated future amortization expense for the core deposit intangible for the year ending December 31, 2023		372,000
Estimated future amortization expense for the core deposit intangible for the year ending December 31, 2024		372,000
Core Deposit Intangible | Talmer
Goodwill and Core Deposit Intangible
Remaining intangible asset		$ 465,000
Core Deposit Intangible | GCFC/ABC Bank
Goodwill and Core Deposit Intangible
Useful life (in years)		10 years
Intangible asset recorded		$ 3,100,000
Remaining intangible asset		2,700,000
Subsequent Event
Subsequent Events
Dividends Payable, Amount Per Share					$ 0.01
Warrants to purchase shares of common stock	815,339
Exercise price of warrant	$ 13.43
Market price per share	$ 14.23
Number os shares issued	45,836
Reduction in additional paid up capital	$ 313,000
All other
Allowance for Loan Losses
Unallocated component of allowance		$ 537,000	$ 542,000	$ 435,000

Summary of Significant Accoun_5

Summary of Significant Accounting Policies - Premises and Equipment (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Transfers and Servicing of Financial Assets
Mortgage loans serviced for others	$ 711.1	$ 695.1
Buildings | Minimum
Premises and equipment
Useful lives	25 years
Buildings | Maximum
Premises and equipment
Useful lives	40 years
Building improvements | Minimum
Premises and equipment
Useful lives	3 years
Building improvements | Maximum
Premises and equipment
Useful lives	15 years
Furniture and equipment | Minimum
Premises and equipment
Useful lives	3 years
Furniture and equipment | Maximum
Premises and equipment
Useful lives	10 years

Acquisitions (Details)

Acquisitions (Details)	Apr. 20, 2018USD ($)item	Dec. 31, 2018USD ($)	Dec. 26, 2017USD ($)	Dec. 31, 2016USD ($)	Oct. 28, 2016USD ($)	Oct. 26, 2016USD ($)
GCFC/ABC Bank
Business Acquisition [Line Items]
Number of bank branches operated | item	4
Acquisition price	$ 41,100,000
Net cash paid	47,180,000
Subordinated debentures retired	6,600,000	$ 304,800,000
Goodwill		10,200,000
Core deposit intangible		3,100,000
Valuation adjustment, fixed assets		1,500,000
Valuation adjustment, loan valuation mark		11,200,000
Acquisition expenses			$ 65,000
Total liabilities	289,769,000
Loans payable		23,400,000
Deposits		248,500,000
Assets acquired:
Cash on due from banks	6,669,000
Interest bearing deposits with financial institutions	500,000
Securities available-for-sale, at fair value	72,091,000
Federal funds sold	4,300,000
FHLBC stock	1,549,000
Loans	227,594,000
Premises and equipment	5,339,000
Other real estate owned	401,000
Goodwill and core deposit intangible	13,280,000
Deferred tax assets, net	3,459,000
Other assets	1,767,000
Total assets	336,949,000
Liabilities assumed:
Deposits-noninterest bearing demand	58,005,000
Deposits - Savings, NOW and money market	91,494,000
Deposits-Time	98,999,000
Total deposits	248,498,000
Securities sold under repurchase agreements	5,623,000
Other short-term borrowings	10,875,000
Notes payable and other borrowings	23,367,000
Other liabilities	1,406,000
Total liabilities	289,769,000
Cash consideration paid	47,180,000
Total Liabilities Assumed and Cash Consideration Paid for Acquisition	$ 336,949,000
GCFC/ABC Bank | Selling, General and Administrative Expenses [Member]
Business Acquisition [Line Items]
Acquisition expenses		3,500,000
GCFC/ABC Bank | Salaries and Employee Benefits
Business Acquisition [Line Items]
Acquisition expenses		1,100,000
GCFC/ABC Bank | Data Processing, Computer and ATM
Business Acquisition [Line Items]
Acquisition expenses		$ 1,800,000
Talmer
Business Acquisition [Line Items]
Acquisition expenses				$ 269,000
Loans payable					$ 221,000,000
Deposits					$ 48,900,000
Liabilities assumed:
Total Liabilities Assumed and Cash Consideration Paid for Acquisition						$ 181,500,000

Acquisition of Loans (Details)

Acquisition of Loans (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Apr. 20, 2018
Business Acquisition [Line Items]
Fair Value	$ 10,965
PCI
Business Acquisition [Line Items]
Fair Value	1,452
PCI | GCFC/ABC Bank
Business Acquisition [Line Items]
Fair Value	10,965	$ 11,360
Contractually required principal and interest payments	18,106	19,447
Best estimate of contractual cash flows not expected to be collected	5,969	6,537
Best estimate of contractual cash flows expected to be collected	12,137	12,910
Non-PCI | GCFC/ABC Bank
Business Acquisition [Line Items]
Fair Value	171,520	216,234
Contractually required principal and interest payments	173,605	220,308
Best estimate of contractual cash flows not expected to be collected	1,175	2,511
Best estimate of contractual cash flows expected to be collected	$ 172,430	$ 217,797

Cash and Due from Banks (Detail

Cash and Due from Banks (Details) - USD ($) $ in Millions	Dec. 31, 2018	Dec. 31, 2017
Other disclosures
Balances	$ 10.8	$ 11
Federal Reserve Bank average regulatory reserve
Other disclosures
Balances	$ 11.3	$ 10.6

Securities - Investment Portfol

Securities - Investment Portfolio (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Securities
Pretax realized losses on sale of available-for-sale securities	$ 9	$ 1,893	$ 3,888
FHLB and FRB Stock
FHLBC stock	7,200	5,400
FRB stock	$ 6,200	$ 4,800

Securities - Amortized Cost and

Securities - Amortized Cost and Fair Value (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2018USD ($)	Dec. 31, 2017USD ($)	Dec. 31, 2016USD ($)
Securities Available-for-Sale
Amortized Cost	$ 546,867	$ 537,645
Gross Unrealized Gains	3,229	8,467
Gross Unrealized Losses	(8,848)	(4,673)
Fair Value	541,248	541,439
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Acquired During Period, at Acquisition, at Fair Value	10,965
Other disclosures
Purchases	75,044	343,470	$ 210,681
Sales	94,663	232,462	$ 306,400
Securities pledged to secure deposits and for other purposes	$ 318,400	301,000
Reimbursement requests greater than 5 %
Other disclosures
Percentage of outstanding principal amount of loans guaranteed by US Department of Education	85
Percent of insured loan	5
Reimbursement requests greater than 9 %
Other disclosures
Percentage of outstanding principal amount of loans guaranteed by US Department of Education	75
Percent of insured loan	9
U.S. Treasury
Securities Available-for-Sale
Amortized Cost	$ 4,006	4,002
Gross Unrealized Losses	(83)	(55)
Fair Value	3,923	3,947
US Treasury and Government
Securities Available-for-Sale
Amortized Cost	11,112
Gross Unrealized Losses	(161)
Fair Value	10,951
U.S. government agencies
Securities Available-for-Sale
Amortized Cost		13,062
Gross Unrealized Gains		8
Gross Unrealized Losses		(9)
Fair Value		13,061
U.S. government agencies mortgage-backed
Securities Available-for-Sale
Amortized Cost	14,407	12,372
Gross Unrealized Gains	45	7
Gross Unrealized Losses	(377)	(165)
Fair Value	14,075	12,214
States and political subdivisions
Securities Available-for-Sale
Amortized Cost	277,112	272,240
Gross Unrealized Gains	1,916	7,116
Gross Unrealized Losses	(4,961)	(1,264)
Fair Value	274,067	278,092
Corporate bonds
Securities Available-for-Sale
Amortized Cost		823
Gross Unrealized Gains		21
Gross Unrealized Losses		(11)
Fair Value		833
Collateralized mortgage obligations
Securities Available-for-Sale
Amortized Cost	66,494	66,892
Gross Unrealized Gains	79	202
Gross Unrealized Losses	(2,144)	(1,155)
Fair Value	64,429	65,939
Asset-backed securities
Securities Available-for-Sale
Amortized Cost	108,574	113,983
Gross Unrealized Gains	1,165	862
Gross Unrealized Losses	(225)	(1,913)
Fair Value	109,514	112,932
FFEL
Securities Available-for-Sale
Fair Value	$ 93,100
Other disclosures
Percentage of outstanding principal amount of loans guaranteed by US Department of Education	97
Collateralized loan obligations
Securities Available-for-Sale
Amortized Cost	$ 65,162	54,271
Gross Unrealized Gains	24	251
Gross Unrealized Losses	(897)	(101)
Fair Value	64,289	$ 54,421
GCO Education Loan Funding Corp
Securities Available-for-Sale
Amortized Cost	27,739
Fair Value	$ 27,763
GCO Education Loan Funding Corp | Stockholders' Equity
Other disclosures
Credit risk as a percentage of benchmark	1.00%
Towd Point Mortgage Trust
Securities Available-for-Sale
Amortized Cost	$ 34,308
Fair Value	33,318
Student Marketing Association [Member]
Securities Available-for-Sale
Amortized Cost	25,808
Fair Value	26,119
Stockholders' Equity | Asset-backed securities | Credit Concentration Risk
Securities Available-for-Sale
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Acquired During Period, at Acquisition, at Fair Value	27,739
Stockholders' Equity | Towd Point Mortgage Trust | Asset-backed securities | Credit Concentration Risk
Securities Available-for-Sale
Amortized Cost	34,308
Fair Value	33,318
Stockholders' Equity | Student Marketing Association [Member] | Asset-backed securities | Credit Concentration Risk
Securities Available-for-Sale
Amortized Cost	25,808
Fair Value	$ 26,119
Minimum | Stockholders' Equity | Towd Point Mortgage Trust | Asset-backed securities | Credit Concentration Risk
Other disclosures
Credit risk as a percentage of benchmark	10.00%
Minimum | Stockholders' Equity | Student Marketing Association [Member] | Asset-backed securities | Credit Concentration Risk
Other disclosures
Credit risk as a percentage of benchmark	10.00%

Securities - Contractural Matur

Securities - Contractural Maturities (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Securities Available-for-Sale, Amortized Cost
Due in one year or less	$ 494
Due after one year through five years	6,910
Due after five years through ten years	6,202
Due after ten years	278,624
Debt securities excluding securities not due at a single maturity date	292,230
Total	$ 546,867	$ 537,645
Securities Available-for-Sale, Weighted Average Yield
Due in one year or less (as a percent)	0.56%
Due after one year through five years (as a percent)	2.00%
Due after five years through ten years (as a percent)	3.25%
Due after ten years (as a percent)	3.02%
Debt securities (as a percent)	2.99%
Total (as a percent)	3.41%
Securities Available-for-Sale, Fair Value
Due in one year or less	$ 495
Due after one year through five years	6,861
Due after five years through ten years	6,275
Due after ten years	275,310
Debt securities	288,941
Fair Value	541,248	541,439
Collateralized mortgage obligations
Securities Available-for-Sale, Amortized Cost
Total	66,494	66,892
Securities Available-for-Sale, Fair Value
Fair Value	64,429	65,939
Asset-backed securities
Securities Available-for-Sale, Amortized Cost
Securities not due at a single maturity date	108,574
Total	$ 108,574	113,983
Securities Available-for-Sale, Weighted Average Yield
Securities not due at a single maturity date, Weighted Average Yield (as a percent)	3.65%
Securities Available-for-Sale, Fair Value
Securities not due at a single maturity date	$ 109,514
Fair Value	109,514	112,932
Collateralized loan obligations
Securities Available-for-Sale, Amortized Cost
Securities not due at a single maturity date	65,162
Total	$ 65,162	54,271
Securities Available-for-Sale, Weighted Average Yield
Securities not due at a single maturity date, Weighted Average Yield (as a percent)	5.05%
Securities Available-for-Sale, Fair Value
Securities not due at a single maturity date	$ 64,289
Fair Value	64,289	$ 54,421
Mortgage-backed and collateralized mortgage obligations
Securities Available-for-Sale, Amortized Cost
Securities not due at a single maturity date	$ 80,901
Securities Available-for-Sale, Weighted Average Yield
Securities not due at a single maturity date, Weighted Average Yield (as a percent)	3.24%
Securities Available-for-Sale, Fair Value
Securities not due at a single maturity date	$ 78,504

Securities - Unrealized Loss Po

Securities - Unrealized Loss Positions (Details)	Dec. 31, 2018USD ($)security	Dec. 31, 2017USD ($)security
Securities Available-for-Sale, Number of Securities
Less than 12 months in an unrealized loss position	16	26
Greater than 12 months in an unrealized loss position	61	22
Total | security	77	48
Securities Available-for-Sale, Unrealized Losses
Less than 12 months in an unrealized loss position	$ 1,256,000	$ 1,457,000
Greater than 12 months in an unrealized loss position	7,592,000	3,216,000
Total	8,848,000	4,673,000
Securities Available-for-Sale, Fair Value
Less than 12 months in an unrealized loss position	86,856,000	102,830,000
Greater than 12 months in an unrealized loss position	197,238,000	108,651,000
Total	$ 284,094,000	$ 211,481,000
U.S. Treasury
Securities Available-for-Sale, Number of Securities
Less than 12 months in an unrealized loss position		1
Greater than 12 months in an unrealized loss position | security	1
Total | security	1	1
Securities Available-for-Sale, Unrealized Losses
Less than 12 months in an unrealized loss position		$ 55,000
Greater than 12 months in an unrealized loss position	$ 83,000
Total	83,000	55,000
Securities Available-for-Sale, Fair Value
Less than 12 months in an unrealized loss position		3,947,000
Greater than 12 months in an unrealized loss position	3,923,000
Total	$ 3,923,000	$ 3,947,000
U.S. government agencies
Securities Available-for-Sale, Number of Securities
Less than 12 months in an unrealized loss position	3	2
Greater than 12 months in an unrealized loss position | security	1
Total | security	4	2
Securities Available-for-Sale, Unrealized Losses
Less than 12 months in an unrealized loss position	$ 100,000	$ 9,000
Greater than 12 months in an unrealized loss position	61,000
Total	161,000	9,000
Securities Available-for-Sale, Fair Value
Less than 12 months in an unrealized loss position	7,385,000	6,550,000
Greater than 12 months in an unrealized loss position	3,566,000
Total	$ 10,951,000	$ 6,550,000
U.S. government agency mortgage-backed
Securities Available-for-Sale, Number of Securities
Less than 12 months in an unrealized loss position		4
Greater than 12 months in an unrealized loss position	11	5
Total | security	11	9
Securities Available-for-Sale, Unrealized Losses
Less than 12 months in an unrealized loss position		$ 24,000
Greater than 12 months in an unrealized loss position	$ 377,000	141,000
Total	377,000	165,000
Securities Available-for-Sale, Fair Value
Less than 12 months in an unrealized loss position		5,501,000
Greater than 12 months in an unrealized loss position	11,439,000	4,843,000
Total	$ 11,439,000	$ 10,344,000
States and political subdivisions
Securities Available-for-Sale, Number of Securities
Less than 12 months in an unrealized loss position	4	13
Greater than 12 months in an unrealized loss position	33	1
Total | security	37	14
Securities Available-for-Sale, Unrealized Losses
Less than 12 months in an unrealized loss position	$ 126,000	$ 1,237,000
Greater than 12 months in an unrealized loss position	4,835,000	27,000
Total	4,961,000	1,264,000
Securities Available-for-Sale, Fair Value
Less than 12 months in an unrealized loss position	17,713,000	45,985,000
Greater than 12 months in an unrealized loss position	110,326,000	1,512,000
Total	$ 128,039,000	$ 47,497,000
Corporate bonds
Securities Available-for-Sale, Number of Securities
Greater than 12 months in an unrealized loss position		1
Total | security		1
Securities Available-for-Sale, Unrealized Losses
Greater than 12 months in an unrealized loss position		$ 11,000
Total		11,000
Securities Available-for-Sale, Fair Value
Greater than 12 months in an unrealized loss position		332,000
Total		$ 332,000
Collateralized mortgage obligations
Securities Available-for-Sale, Number of Securities
Less than 12 months in an unrealized loss position	2	3
Greater than 12 months in an unrealized loss position	10	8
Total | security	12	11
Securities Available-for-Sale, Unrealized Losses
Less than 12 months in an unrealized loss position	$ 309,000	$ 31,000
Greater than 12 months in an unrealized loss position	1,835,000	1,124,000
Total	2,144,000	1,155,000
Securities Available-for-Sale, Fair Value
Less than 12 months in an unrealized loss position	15,211,000	11,534,000
Greater than 12 months in an unrealized loss position	43,687,000	40,219,000
Total	$ 58,898,000	$ 51,753,000
Asset-backed securities
Securities Available-for-Sale, Number of Securities
Greater than 12 months in an unrealized loss position	4	7
Total | security	4	7
Securities Available-for-Sale, Unrealized Losses
Greater than 12 months in an unrealized loss position	$ 225,000	$ 1,913,000
Total	225,000	1,913,000
Securities Available-for-Sale, Fair Value
Greater than 12 months in an unrealized loss position	16,473,000	61,745,000
Total	$ 16,473,000	$ 61,745,000
Collateralized loan obligations
Securities Available-for-Sale, Number of Securities
Less than 12 months in an unrealized loss position	7	3
Greater than 12 months in an unrealized loss position | security	1
Total | security	8	3
Securities Available-for-Sale, Unrealized Losses
Less than 12 months in an unrealized loss position	$ 721,000	$ 101,000
Greater than 12 months in an unrealized loss position	176,000
Total	897,000	101,000
Securities Available-for-Sale, Fair Value
Less than 12 months in an unrealized loss position	46,547,000	29,313,000
Greater than 12 months in an unrealized loss position	7,824,000
Total	$ 54,371,000	$ 29,313,000

Securities - Realized Gain (Los

Securities - Realized Gain (Loss) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Securities
Sales	$ 94,663	$ 232,462	$ 306,400
Gross realized gains on securities	369	2,367	1,675
Gross realized losses on securities	(9)	(1,893)	(3,888)
Securities (losses) gains, net	360	474	(2,213)
Related tax (expense) benefit	$ (100)	$ (198)	$ 882
Effective tax rate applied (as a percent)	27.80%	41.80%	39.90%
Available-for-sale Securities Pledged as Collateral	$ 318,400	$ 301,000

Loans - Major Classifications (

Loans - Major Classifications (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Loans
Total loans, gross	$ 1,884,409	$ 1,616,942
Net deferred loan fees	1,653	680
Total loans, excluding PCI loans	1,886,062
PCI loans, net of purchase accounting adjustments	1,897,027	1,617,622	$ 1,478,809
Total Loans	1,897,027	1,617,622
Construction Loans
Loans
PCI loans, net of purchase accounting adjustments		85,162	64,720
Total Loans	109,135
Home Equity Line of Credit
Loans
Total loans, gross	140,442	112,833
Other
Loans
Total loans, gross	14,439	13,383
PCI
Loans
Total loans, excluding PCI loans	11,906
PCI loans, net of purchase accounting adjustments	10,965
Non-PCI
Loans
Total loans, excluding PCI loans	1,886,062	1,617,622
PCI loans, net of purchase accounting adjustments	1,886,062
Commercial
Loans
Total loans, gross	314,323	272,851
PCI loans, net of purchase accounting adjustments	314,323	272,851	228,113
Real estate - commercial
Loans
Total loans, gross	820,941	750,991
PCI loans, net of purchase accounting adjustments		750,991	736,247
Total Loans	825,123
Real estate - commercial | Construction Loans
Loans
Total loans, gross	108,390	85,162
Real estate - residential
Loans
Total loans, gross	407,068	313,397
PCI loans, net of purchase accounting adjustments		313,397	276,225
Total Loans	413,106
Consumer
Loans
PCI loans, net of purchase accounting adjustments		112,833	101,626
Total Loans	140,442
Lease financing receivables
Loans
Total loans, gross	78,806	68,325
PCI loans, net of purchase accounting adjustments	78,806	$ 68,325	$ 55,451
30 to 59 Days Past Due
Loans
Total Loans	10,617
30 to 59 Days Past Due | PCI
Loans
Total loans, excluding PCI loans	9,165
60 to 89 Days Past Due
Loans
Total Loans	1,824
60 to 89 Days Past Due | PCI
Loans
Total loans, excluding PCI loans	1,824
90 Days or Greater Past Due
Loans
Total Loans	917
90 Days or Greater Past Due | PCI
Loans
Total loans, excluding PCI loans	$ 917

Loans - Major Classifications -

Loans - Major Classifications - Loan Concentrations (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Loans
Growth in loan balance	$ 279.4
Total real estate
Loans
Loans receivable as a percentage of total portfolio	77.90%	78.00%

Loans - Aging Analysis (Details

Loans - Aging Analysis (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Aged analysis of past due loans
Total Past Due		$ 5,606
Current	$ 1,867,663	1,597,628
Nonaccrual	16,006	14,388
Total Loans	1,897,027	1,617,622	$ 1,478,809
Total Loans	1,897,027	1,617,622
Total Loans	13,358
Recorded Investment 90 days or Greater Past Due and Accruing	935	254
30 to 59 Days Past Due
Aged analysis of past due loans
Total Past Due		4,212
Total Loans	10,617
60 to 89 Days Past Due
Aged analysis of past due loans
Total Past Due		1,146
Total Loans	1,824
90 Days or Greater Past Due
Aged analysis of past due loans
Total Past Due		248
Total Loans	917
PCI
Aged analysis of past due loans
Current	7,248
Nonaccrual	2,265
Total Loans	10,965
Recorded Investment 90 days or Greater Past Due and Accruing	935
Non-PCI
Aged analysis of past due loans
Current	1,860,415
Nonaccrual	13,741
Total Loans	1,886,062
Multifamily
Aged analysis of past due loans
Total Past Due	724
Current	195,504	125,049,000
Nonaccrual		4,723,000
Total Loans	196,228	129,772,000
Recorded Investment 90 days or Greater Past Due and Accruing	180
Multifamily | 30 to 59 Days Past Due
Aged analysis of past due loans
Total Past Due	545
Multifamily | 90 Days or Greater Past Due
Aged analysis of past due loans
Total Past Due	179
Construction Loans
Aged analysis of past due loans
Total Loans		85,162	64,720
Total Loans	109,135
Commercial
Aged analysis of past due loans
Total Past Due	410	1,270
Current	313,913	271,581
Total Loans	314,323	272,851	228,113
Recorded Investment 90 days or Greater Past Due and Accruing	361
Commercial | 30 to 59 Days Past Due
Aged analysis of past due loans
Total Past Due	58	995
Commercial | 60 to 89 Days Past Due
Aged analysis of past due loans
Total Past Due		275
Commercial | 90 Days or Greater Past Due
Aged analysis of past due loans
Total Past Due	352
Lease financing receivables
Aged analysis of past due loans
Current	78,806	68,147
Nonaccrual		178
Total Loans	78,806	68,325	55,451
Real estate - commercial
Aged analysis of past due loans
Total Loans		750,991	736,247
Total Loans	825,123
Real estate - commercial | Owner occupied general purpose
Aged analysis of past due loans
Total Past Due	1,801	1,136
Current	160,892	144,267
Nonaccrual	1,579	455
Total Loans	164,272	145,858
Recorded Investment 90 days or Greater Past Due and Accruing	36
Real estate - commercial | Owner occupied general purpose | 30 to 59 Days Past Due
Aged analysis of past due loans
Total Past Due	1,768	1,136
Real estate - commercial | Owner occupied general purpose | 90 Days or Greater Past Due
Aged analysis of past due loans
Total Past Due	33
Real estate - commercial | Owner occupied special purpose
Aged analysis of past due loans
Total Past Due	961	226
Current	192,426	170,546
Nonaccrual	395	342
Total Loans	193,782	171,114
Real estate - commercial | Owner occupied special purpose | 30 to 59 Days Past Due
Aged analysis of past due loans
Total Past Due	826	226
Real estate - commercial | Owner occupied special purpose | 60 to 89 Days Past Due
Aged analysis of past due loans
Total Past Due	135
Real estate - commercial | Non-owner occupied general purpose
Aged analysis of past due loans
Total Past Due	3,035	593
Current	286,115	273,203
Nonaccrual	4,236	1,163
Total Loans	293,386	274,959
Real estate - commercial | Non-owner occupied general purpose | 30 to 59 Days Past Due
Aged analysis of past due loans
Total Past Due	2,832
Real estate - commercial | Non-owner occupied general purpose | 60 to 89 Days Past Due
Aged analysis of past due loans
Total Past Due	203	593
Real estate - commercial | Non-owner occupied special purpose
Aged analysis of past due loans
Total Past Due		248
Current	106,036	92,923
Nonaccrual	3,099
Total Loans	109,135	93,171
Recorded Investment 90 days or Greater Past Due and Accruing		254
Real estate - commercial | Non-owner occupied special purpose | 90 Days or Greater Past Due
Aged analysis of past due loans
Total Past Due		248
Real estate - commercial | Retail properties
Aged analysis of past due loans
Total Past Due	620
Current	45,968	49,538
Nonaccrual		1,081
Total Loans	46,588	50,619
Real estate - commercial | Retail properties | 60 to 89 Days Past Due
Aged analysis of past due loans
Total Past Due	620
Real estate - commercial | Farm
Aged analysis of past due loans
Current	13,778	15,270
Total Loans	13,778	15,270
Real estate - commercial | Construction Loans | Homebuilder
Aged analysis of past due loans
Total Past Due		129
Current	5,102	2,221
Total Loans	5,102	2,350
Real estate - commercial | Construction Loans | Homebuilder | 30 to 59 Days Past Due
Aged analysis of past due loans
Total Past Due		129
Real estate - commercial | Construction Loans | Land
Aged analysis of past due loans
Total Past Due	266	1,124
Current	2,478	1,319
Total Loans	2,744	2,443
Real estate - commercial | Construction Loans | Land | 30 to 59 Days Past Due
Aged analysis of past due loans
Total Past Due	266	1,124
Real estate - commercial | Construction Loans | Commercial speculative
Aged analysis of past due loans
Total Past Due	350
Current	55,060	32,028
Total Loans	55,410	32,028
Recorded Investment 90 days or Greater Past Due and Accruing	355
Real estate - commercial | Construction Loans | Commercial speculative | 90 Days or Greater Past Due
Aged analysis of past due loans
Total Past Due	350
Real estate - commercial | Construction Loans | All other
Aged analysis of past due loans
Current	45,028	48,140
Nonaccrual	106	201
Total Loans	45,134	48,341
Real estate - residential
Aged analysis of past due loans
Total Loans		313,397	276,225
Total Loans	413,106
Real estate - residential | Investor
Aged analysis of past due loans
Total Past Due	957
Current	69,148	55,248
Nonaccrual	353	372
Total Loans	70,458	55,620
Real estate - residential | Investor | 30 to 59 Days Past Due
Aged analysis of past due loans
Total Past Due	801
Real estate - residential | Investor | 60 to 89 Days Past Due
Aged analysis of past due loans
Total Past Due	156
Real estate - residential | Multifamily
Aged analysis of past due loans
Total Loans		129,772
Real estate - residential | Owner occupied
Aged analysis of past due loans
Total Past Due	1,946	74
Current	135,360	123,257
Nonaccrual	3,076	4,674
Total Loans	140,382	128,005
Real estate - residential | Owner occupied | 30 to 59 Days Past Due
Aged analysis of past due loans
Total Past Due	1,241	74
Real estate - residential | Owner occupied | 60 to 89 Days Past Due
Aged analysis of past due loans
Total Past Due	705
Real estate - residential | Revolving and junior liens
Aged analysis of past due loans
Total Past Due	775	769
Current	138,801	110,872
Nonaccrual	866	1,192
Total Loans	140,442	112,833
Real estate - residential | Revolving and junior liens | 30 to 59 Days Past Due
Aged analysis of past due loans
Total Past Due	775	491
Real estate - residential | Revolving and junior liens | 60 to 89 Days Past Due
Aged analysis of past due loans
Total Past Due		278
Consumer
Aged analysis of past due loans
Total Loans		112,833	101,626
Total Loans	140,442
All other
Aged analysis of past due loans
Total Past Due	61	37
Current	16,000	14,019
Nonaccrual	31	7
Total Loans	16,092	14,063	$ 16,427
Total Loans	16,092
Recorded Investment 90 days or Greater Past Due and Accruing	3
All other | 30 to 59 Days Past Due
Aged analysis of past due loans
Total Past Due	53	$ 37
All other | 60 to 89 Days Past Due
Aged analysis of past due loans
Total Past Due	5
All other | 90 Days or Greater Past Due
Aged analysis of past due loans
Total Past Due	$ 3

Loans - Inclusion (Details)

Loans - Inclusion (Details)	12 Months Ended
	Dec. 31, 2018USD ($)
Minimum
Loans by risk rating
Loan commitment for inclusion in credit quality analysis	$ 50,000

Loans - Credit Quality (Details

Loans - Credit Quality (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Loans by risk rating
Total Loans	$ 1,897,027	$ 1,617,622	$ 1,478,809
Total loans, excluding PCI loans	1,886,062
PCI loans, net of purchase accounting adjustments	10,965
Total Loans	1,897,027	1,617,622
Multifamily
Loans by risk rating
Total Loans	196,228	129,772,000
Commercial
Loans by risk rating
Total Loans	314,323	272,851	228,113
Lease financing receivables
Loans by risk rating
Total Loans	78,806	68,325	55,451
Real estate - commercial
Loans by risk rating
Total Loans		750,991	736,247
PCI loans, net of purchase accounting adjustments	4,182
Total Loans	825,123
Real estate - commercial | Owner occupied general purpose
Loans by risk rating
Total Loans	164,272	145,858
Real estate - commercial | Owner occupied special purpose
Loans by risk rating
Total Loans	193,782	171,114
Real estate - commercial | Non-owner occupied general purpose
Loans by risk rating
Total Loans	293,386	274,959
Real estate - commercial | Non-owner occupied special purpose
Loans by risk rating
Total Loans	109,135	93,171
Real estate - commercial | Retail properties
Loans by risk rating
Total Loans	46,588	50,619
Real estate - commercial | Farm
Loans by risk rating
Total Loans	13,778	15,270
Real estate - residential
Loans by risk rating
Total Loans		313,397	276,225
PCI loans, net of purchase accounting adjustments	6,038
Total Loans	413,106
Real estate - residential | Investor
Loans by risk rating
Total Loans	70,458	55,620
Real estate - residential | Multifamily
Loans by risk rating
Total Loans		129,772
Real estate - residential | Owner occupied
Loans by risk rating
Total Loans	140,382	128,005
Real estate - residential | Revolving and junior liens
Loans by risk rating
Total Loans	140,442	112,833
Consumer
Loans by risk rating
Total Loans		112,833	101,626
Total Loans	140,442
All other
Loans by risk rating
Total Loans	16,092	14,063	16,427
Total Loans	16,092
Pass
Loans by risk rating
Total Loans		1,583,352
Total loans, excluding PCI loans	1,834,550
PCI loans, net of purchase accounting adjustments	907
Total Loans	1,835,457
Pass | Multifamily
Loans by risk rating
Total Loans	195,249
Pass | Commercial
Loans by risk rating
Total Loans	305,993	270,889
Pass | Lease financing receivables
Loans by risk rating
Total Loans	78,806	67,500
Pass | Real estate - commercial | Owner occupied general purpose
Loans by risk rating
Total Loans	157,334	142,843
Pass | Real estate - commercial | Owner occupied special purpose
Loans by risk rating
Total Loans	186,218	169,621
Pass | Real estate - commercial | Non-owner occupied general purpose
Loans by risk rating
Total Loans	284,818	271,731
Pass | Real estate - commercial | Non-owner occupied special purpose
Loans by risk rating
Total Loans	104,526	89,582
Pass | Real estate - commercial | Retail properties
Loans by risk rating
Total Loans	44,805	48,321
Pass | Real estate - commercial | Farm
Loans by risk rating
Total Loans	11,307	11,755
Pass | Real estate - residential | Investor
Loans by risk rating
Total Loans	69,242	55,172
Pass | Real estate - residential | Multifamily
Loans by risk rating
Total Loans		125,049
Pass | Real estate - residential | Owner occupied
Loans by risk rating
Total Loans	135,858	122,178
Pass | Real estate - residential | Revolving and junior liens
Loans by risk rating
Total Loans	138,553	110,934
Pass | All other
Loans by risk rating
Total Loans	16,061	14,043
Special Mention
Loans by risk rating
Total Loans		10,965
Total loans, excluding PCI loans	16,243
PCI loans, net of purchase accounting adjustments	2,906
Total Loans	19,149
Special Mention | Commercial
Loans by risk rating
Total Loans	8,193	1,962
Special Mention | Real estate - commercial | Owner occupied general purpose
Loans by risk rating
Total Loans	1,660	1,927
Special Mention | Real estate - commercial | Owner occupied special purpose
Loans by risk rating
Total Loans	3,429	1,152
Special Mention | Real estate - commercial | Non-owner occupied general purpose
Loans by risk rating
Total Loans	202	2,065
Special Mention | Real estate - commercial | Non-owner occupied special purpose
Loans by risk rating
Total Loans	1,510
Special Mention | Real estate - commercial | Retail properties
Loans by risk rating
Total Loans		1,217
Special Mention | Real estate - commercial | Farm
Loans by risk rating
Total Loans	1,249	1,029
Special Mention | Real estate - residential | Owner occupied
Loans by risk rating
Total Loans		561
Substandard
Loans by risk rating
Total Loans		23,305
Total loans, excluding PCI loans	35,269
PCI loans, net of purchase accounting adjustments	7,152
Total Loans	42,421
Substandard | Multifamily
Loans by risk rating
Total Loans	979
Substandard | Commercial
Loans by risk rating
Total Loans	137
Substandard | Lease financing receivables
Loans by risk rating
Total Loans		825
Substandard | Real estate - commercial | Owner occupied general purpose
Loans by risk rating
Total Loans	5,278	1,088
Substandard | Real estate - commercial | Owner occupied special purpose
Loans by risk rating
Total Loans	4,135	341
Substandard | Real estate - commercial | Non-owner occupied general purpose
Loans by risk rating
Total Loans	8,366	1,163
Substandard | Real estate - commercial | Non-owner occupied special purpose
Loans by risk rating
Total Loans	3,099	3,589
Substandard | Real estate - commercial | Retail properties
Loans by risk rating
Total Loans	1,783	1,081
Substandard | Real estate - commercial | Farm
Loans by risk rating
Total Loans	1,222	2,486
Substandard | Real estate - residential | Investor
Loans by risk rating
Total Loans	1,216	448
Substandard | Real estate - residential | Multifamily
Loans by risk rating
Total Loans		4,723
Substandard | Real estate - residential | Owner occupied
Loans by risk rating
Total Loans	4,524	5,266
Substandard | Real estate - residential | Revolving and junior liens
Loans by risk rating
Total Loans	1,889	1,899
Substandard | All other
Loans by risk rating
Total Loans	31	20
PCI
Loans by risk rating
Total Loans	10,965
Total loans, excluding PCI loans	11,906
PCI loans, net of purchase accounting adjustments	1,452
Non-PCI
Loans by risk rating
Total Loans	1,886,062
Total loans, excluding PCI loans	1,886,062	1,617,622
Construction Loans
Loans by risk rating
Total Loans		85,162	$ 64,720
PCI loans, net of purchase accounting adjustments	745
Total Loans	109,135
Construction Loans | Real estate - commercial | Homebuilder
Loans by risk rating
Total Loans	5,102	2,350
Construction Loans | Real estate - commercial | Land
Loans by risk rating
Total Loans	2,744	2,443
Construction Loans | Real estate - commercial | Commercial speculative
Loans by risk rating
Total Loans	55,410	32,028
Construction Loans | Real estate - commercial | All other
Loans by risk rating
Total Loans	45,134	48,341
Construction Loans | Pass | Real estate - commercial | Homebuilder
Loans by risk rating
Total Loans	5,102	2,350
Construction Loans | Pass | Real estate - commercial | Land
Loans by risk rating
Total Loans	2,744	2,443
Construction Loans | Pass | Real estate - commercial | Commercial speculative
Loans by risk rating
Total Loans	55,410	32,028
Construction Loans | Pass | Real estate - commercial | All other
Loans by risk rating
Total Loans	42,524	46,913
Construction Loans | Special Mention | Real estate - commercial | All other
Loans by risk rating
Total Loans		1,052
Construction Loans | Substandard | Real estate - commercial | All other
Loans by risk rating
Total Loans	2,610	$ 376
30 to 59 Days Past Due
Loans by risk rating
Total Loans	10,617
30 to 59 Days Past Due | PCI
Loans by risk rating
Total loans, excluding PCI loans	9,165
PCI loans, net of purchase accounting adjustments	1,452
60 to 89 Days Past Due
Loans by risk rating
Total Loans	1,824
60 to 89 Days Past Due | PCI
Loans by risk rating
Total loans, excluding PCI loans	1,824
90 Days or Greater Past Due
Loans by risk rating
Total Loans	917
90 Days or Greater Past Due | PCI
Loans by risk rating
Total loans, excluding PCI loans	$ 917

Loans - Repossessed Assets (Det

Loans - Repossessed Assets (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Repossessed and foreclosed assets
Other real estate owned	$ 7,175	$ 8,371	$ 11,916	$ 19,141
Consumer
Repossessed and foreclosed assets
Mortgage loans in process of foreclosure	$ 448,000,000	$ 1,300

Loans - Impaired Loans - Record

Loans - Impaired Loans - Recorded Investment, Unpaid Principal Balance and Related Allowance (Details) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Recorded Investment
With no related allowance recorded	$ 7,844,000	$ 14,855,000
With an allowance recorded	12,515,000	5,257,000
Total impaired loans	20,359,000	20,112,000
Unpaid Principal Balance
With no related allowance recorded	9,895,000	17,792,000
With an allowance recorded	13,936,000	5,257,000
Total impaired loans	23,831,000	23,049,000
Related Allowance
With an allowance recorded	352,000	144,000
Multifamily
Recorded Investment
With no related allowance recorded		4,723,000
Unpaid Principal Balance
With no related allowance recorded		4,965,000
Lease financing receivables
Recorded Investment
With no related allowance recorded		178,000
Unpaid Principal Balance
With no related allowance recorded		213,000
Real estate - commercial | Owner occupied general purpose
Recorded Investment
With no related allowance recorded	1,659,000	455,000
With an allowance recorded	396,000
Unpaid Principal Balance
With no related allowance recorded	1,782,000	495,000
With an allowance recorded	396,000
Related Allowance
With an allowance recorded	3,000
Real estate - commercial | Owner occupied special purpose
Recorded Investment
With no related allowance recorded	395,000	342,000
Unpaid Principal Balance
With no related allowance recorded	530,000	498,000
Real estate - commercial | Non-owner occupied general purpose
Recorded Investment
With no related allowance recorded	1,138,000	1,163,000
With an allowance recorded	3,098,000
Unpaid Principal Balance
With no related allowance recorded	1,159,000	1,538,000
With an allowance recorded	4,038,000
Related Allowance
With an allowance recorded	97,000
Real estate - commercial | Non-owner occupied special purpose
Recorded Investment
With an allowance recorded	3,099,000
Unpaid Principal Balance
With an allowance recorded	3,575,000
Related Allowance
With an allowance recorded	139,000
Real estate - commercial | Retail properties
Recorded Investment
With no related allowance recorded		1,081,000
Unpaid Principal Balance
With no related allowance recorded		1,177,000
Real estate - residential | Investor
Recorded Investment
With no related allowance recorded	353,000	372,000
With an allowance recorded	808,000	829,000
Unpaid Principal Balance
With no related allowance recorded	459,000	676,000
With an allowance recorded	808,000	829,000
Related Allowance
With an allowance recorded	4,000	10,000
Real estate - residential | Owner occupied
Recorded Investment
With no related allowance recorded	3,359,000	5,208,000
With an allowance recorded	3,676,000	3,443,000
Unpaid Principal Balance
With no related allowance recorded	4,882,000	6,680,000
With an allowance recorded	3,679,000	3,443,000
Related Allowance
With an allowance recorded	46,000	43,000
Real estate - residential | Revolving and junior liens
Recorded Investment
With no related allowance recorded	884,000	1,125,000
With an allowance recorded	1,357,000	985,000
Unpaid Principal Balance
With no related allowance recorded	1,003,000	1,313,000
With an allowance recorded	1,357,000	985,000
Related Allowance
With an allowance recorded	49,000	91,000
Consumer
Recorded Investment
With no related allowance recorded	7,000	7,000
With an allowance recorded	24,000
Unpaid Principal Balance
With no related allowance recorded	7,000	8,000
With an allowance recorded	25,000
Related Allowance
With an allowance recorded	13,000
Construction Loans | Real estate - commercial | All other
Recorded Investment
With no related allowance recorded	49,000	201,000
With an allowance recorded	57,000
Unpaid Principal Balance
With no related allowance recorded	73,000	$ 229,000
With an allowance recorded	58,000
Related Allowance
With an allowance recorded	$ 1,000

Loans - Impaired Loans - Averag

Loans - Impaired Loans - Average Recorded Investment and Interest Income Recognized (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Average Recorded Investment
With no related allowance recorded	$ 11,350	$ 18,047	$ 20,982
With an allowance recorded	8,886	3,153	605
Total impaired loans	20,236	21,200	21,587
Interest Income Recognized
With no related allowance recorded	48	45	323
With an allowance recorded	278	201
Total impaired loans	326	246	323
Commercial
Average Recorded Investment
With no related allowance recorded		120	155
With an allowance recorded			2
Lease financing receivables
Average Recorded Investment
With no related allowance recorded	89	272	183
Real estate - commercial | Owner occupied general purpose
Average Recorded Investment
With no related allowance recorded	1,057	1,168	2,098
With an allowance recorded	198
Interest Income Recognized
With no related allowance recorded	8		87
With an allowance recorded	29
Real estate - commercial | Owner occupied special purpose
Average Recorded Investment
With no related allowance recorded	369	364	574
Real estate - commercial | Non-owner occupied general purpose
Average Recorded Investment
With no related allowance recorded	1,150	1,453	1,395
With an allowance recorded	1,549	123	123
Interest Income Recognized
With no related allowance recorded			2
Real estate - commercial | Non-owner occupied special purpose
Average Recorded Investment
With no related allowance recorded		507	507
With an allowance recorded	1,549
Real estate - commercial | Retail properties
Average Recorded Investment
With no related allowance recorded	541	1,130	589
Real estate - commercial | Farm
Average Recorded Investment
With no related allowance recorded			636
Real estate - residential | Investor
Average Recorded Investment
With no related allowance recorded	362	1,106	1,874
With an allowance recorded	818	414
Interest Income Recognized
With no related allowance recorded			47
With an allowance recorded	43	43
Real estate - residential | Multifamily
Average Recorded Investment
With no related allowance recorded	2,362	2,362
Real estate - residential | Owner occupied
Average Recorded Investment
With no related allowance recorded	4,283	7,516	10,181
With an allowance recorded	3,560	2,123	457
Interest Income Recognized
With no related allowance recorded	39	44	158
With an allowance recorded	150	123
Real estate - residential | Revolving and junior liens
Average Recorded Investment
With no related allowance recorded	1,005	1,804	2,608
With an allowance recorded	1,171	493	23
Interest Income Recognized
With no related allowance recorded	1	1	29
With an allowance recorded	56	35
Consumer
Average Recorded Investment
With no related allowance recorded	7	4
With an allowance recorded	12
Construction Loans | Real estate - commercial | Commercial speculative
Average Recorded Investment
With no related allowance recorded		37	79
Construction Loans | Real estate - commercial | All other
Average Recorded Investment
With no related allowance recorded	125	$ 204	$ 103
With an allowance recorded	$ 29

Loans - TDR (Details)

Loans - TDR (Details) $ in Thousands	12 Months Ended		24 Months Ended
	Dec. 31, 2018USD ($)contract	Dec. 31, 2017USD ($)contract	Dec. 31, 2018USD ($)item
Troubled debt restructurings - modified during the period
# of contracts | contract	21	11
Pre-modification recorded investment	$ 1,894	$ 690
Post-modification recorded investment	1,709	761
TDR's defaulted
# of contracts | item			0
Other information
Commitments to lend to borrowers whose loans were classified as impaired	0		$ 0
Total Past Due		$ 5,606
Other
Troubled debt restructurings - modified during the period
# of contracts | contract		1
Pre-modification recorded investment		$ 97
Post-modification recorded investment		$ 131
HAMP
Troubled debt restructurings - modified during the period
# of contracts | contract		6
Pre-modification recorded investment		$ 319
Post-modification recorded investment		350
Real estate - commercial | Owner occupied special purpose
Other information
Total Past Due	$ 961	226	961
Real estate - commercial | Owner occupied special purpose | Other
Troubled debt restructurings - modified during the period
# of contracts | contract	1
Pre-modification recorded investment	$ 110
Post-modification recorded investment	46
Real estate - commercial | Owner occupied general purpose
Other information
Total Past Due	$ 1,801	1,136	1,801
Real estate - commercial | Owner occupied general purpose | Other
Troubled debt restructurings - modified during the period
# of contracts | contract	1
Pre-modification recorded investment	$ 427
Post-modification recorded investment	396
Real estate - commercial | Non-owner occupied general purpose
Other information
Total Past Due	3,035	593	3,035
Real estate - residential | Investor
Other information
Total Past Due	957		957
Real estate - residential | Owner occupied
Other information
Total Past Due	$ 1,946	74	1,946
Real estate - residential | Owner occupied | Other
Troubled debt restructurings - modified during the period
# of contracts | contract	1
Pre-modification recorded investment	$ 34
Post-modification recorded investment	$ 29
Real estate - residential | Owner occupied | HAMP
Troubled debt restructurings - modified during the period
# of contracts | contract	4
Pre-modification recorded investment	$ 502
Post-modification recorded investment	443
Real estate - residential | Revolving and junior liens
Other information
Total Past Due	$ 775	769	775
Real estate - residential | Revolving and junior liens | Other
Troubled debt restructurings - modified during the period
# of contracts | contract	9
Pre-modification recorded investment	$ 622
Post-modification recorded investment	$ 600
Real estate - residential | Revolving and junior liens | HAMP
Troubled debt restructurings - modified during the period
# of contracts | contract	3
Pre-modification recorded investment	$ 117
Post-modification recorded investment	$ 115
Real estate - residential | Revolving and junior liens | Rate
Troubled debt restructurings - modified during the period
# of contracts | contract	1
Pre-modification recorded investment	$ 24
Post-modification recorded investment	$ 24
Real estate - construction | Non-owner occupied general purpose | HAMP
Troubled debt restructurings - modified during the period
# of contracts | contract	1
Pre-modification recorded investment	$ 58
Post-modification recorded investment	56
Commercial
Other information
Total Past Due	410	1,270	410
90 Days or Greater Past Due
Other information
Total Past Due		$ 248
90 Days or Greater Past Due | Real estate - commercial | Owner occupied general purpose
Other information
Total Past Due	33		33
90 Days or Greater Past Due | Commercial
Other information
Total Past Due	352		352
Principal Officers, Directors, and Affiliates | 90 Days or Greater Past Due
Other information
Total Past Due	$ 0		$ 0

Loans - Accretable Discount on

Loans - Accretable Discount on Purchased Loans (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2018USD ($)
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield Movement Schedule [Roll Forward]
Beginning balance	$ 835
Purchases	11,269
Accretion	(2,635)
Transfers	(534)
Ending balance	8,935
PCI
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield Movement Schedule [Roll Forward]
Purchases	1,551
Purchases	6,536
Accretion	(424)
Accretion	434
Transfers	(28)
Transfers	(133)
Ending balance	1,099
Ending balance	5,969
Non-PCI
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield Movement Schedule [Roll Forward]
Beginning balance	835
Purchases	3,182
Accretion	(1,777)
Transfers	(373)
Ending balance	$ 1,867

Loans - Related Parties (Detail

Loans - Related Parties (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Loans to principal officers, directors, and their affiliates
Beginning balance	$ 1,524	$ 1,703
New loans	89	20
Repayments and other reductions	(196)	(199)
Ending balance	$ 1,417	$ 1,524

Allowance for Loan Losses (Deta

Allowance for Loan Losses (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Allowance for loan losses:
Beginning Balance	$ 17,461	$ 16,158	$ 16,223
Charge-offs	2,097	2,306	3,190
Recoveries	2,414	1,809	2,375
Provision (release)	1,228	1,800	750
Ending Balance	19,006	17,461	16,158
Ending balance: Individually evaluated for impairment	352	144	1,049
Ending balance: Collectively evaluated for impairment	18,654	17,317	15,109
Loans:
Ending balance	1,897,027	1,617,622	1,478,809
Ending balance	1,897,027	1,617,622
Ending balance: Individually evaluated for impairment	20,359	20,112	22,287
Ending balance: Collectively evaluated for impairment	1,865,703	1,597,510	1,456,522
Ending balance: Acquired and accounted for ASC 310-30	10,965
Commercial
Allowance for loan losses:
Beginning Balance		1,629	1,463
Charge-offs			95
Recoveries			32
Provision (release)			229
Ending Balance			1,629
Ending balance: Collectively evaluated for impairment			1,629
Loans:
Ending balance	314,323	272,851	228,113
Ending balance: Individually evaluated for impairment			240
Ending balance: Collectively evaluated for impairment			227,873
Commercial without Leases
Allowance for loan losses:
Beginning Balance	2,453	1,629
Charge-offs	41	25
Recoveries	157	30
Provision (release)	263	819
Ending Balance	2,832	2,453	1,629
Ending balance: Collectively evaluated for impairment	2,832	2,453
Loans:
Ending balance		272,851
Ending balance	314,323
Ending balance: Collectively evaluated for impairment	314,323	272,851
Commercial leases
Allowance for loan losses:
Beginning Balance	692	633
Charge-offs	13	215
Provision (release)	55	274
Ending Balance	734	692	633
Ending balance: Collectively evaluated for impairment	734	692
Loans:
Ending balance	78,806
Ending balance: Individually evaluated for impairment		178
Ending balance: Collectively evaluated for impairment	78,806	68,147
Lease financing receivables
Allowance for loan losses:
Beginning Balance		633	633
Charge-offs			23
Recoveries			5
Provision (release)			18
Ending Balance			633
Ending balance: Collectively evaluated for impairment			633
Loans:
Ending balance	78,806	68,325	55,451
Ending balance: Individually evaluated for impairment			366
Ending balance: Collectively evaluated for impairment			55,085
Real estate - commercial
Allowance for loan losses:
Beginning Balance	9,522	9,547	9,013
Charge-offs	1,548	309	1,633
Recoveries	447	161	640
Provision (release)	2,049	123	1,527
Ending Balance	10,470	9,522	9,547
Ending balance: Individually evaluated for impairment	239		246
Ending balance: Collectively evaluated for impairment	10,231	9,522	9,301
Loans:
Ending balance		750,991	736,247
Ending balance	825,123
Ending balance: Individually evaluated for impairment	9,785	3,041	6,448
Ending balance: Collectively evaluated for impairment	811,156	747,950	729,799
Ending balance: Acquired and accounted for ASC 310-30	4,182
Real estate - residential
Allowance for loan losses:
Beginning Balance	1,846	2,178	724
Charge-offs	(45)	1,347	450
Recoveries	1,146	980	486
Provision (release)	(1,106)	35	1,418
Ending Balance	1,931	1,846	2,178
Ending balance: Individually evaluated for impairment	50	53	803
Ending balance: Collectively evaluated for impairment	1,881	1,793	1,375
Loans:
Ending balance		313,397	276,225
Ending balance	413,106
Ending balance: Individually evaluated for impairment	8,196	14,575	12,468
Ending balance: Collectively evaluated for impairment	398,872	298,822	263,757
Ending balance: Acquired and accounted for ASC 310-30	6,038
Consumer
Allowance for loan losses:
Beginning Balance	1,446	1,331	2,050
Charge-offs	147	386	622
Recoveries	364	243	845
Provision (release)	(214)	258	(942)
Ending Balance	1,449	1,446	1,331
Ending balance: Individually evaluated for impairment	49	91
Ending balance: Collectively evaluated for impairment	1,400	1,355	1,331
Loans:
Ending balance		112,833	101,626
Ending balance	140,442
Ending balance: Individually evaluated for impairment	2,241	2,110	2,484
Ending balance: Collectively evaluated for impairment	138,201	110,723	99,142
All other
Allowance for loan losses:
Beginning Balance	579	451	2,075
Charge-offs	409	1	344
Recoveries	265	18	271
Provision (release)	186	111	(1,551)
Ending Balance	621	579	451
Ending balance: Individually evaluated for impairment	13
Ending balance: Collectively evaluated for impairment	608	579	451
Loans:
Ending balance	16,092	14,063	16,427
Ending balance	16,092
Ending balance: Individually evaluated for impairment	31	7
Ending balance: Collectively evaluated for impairment	16,061	14,056	16,427
Construction Loans
Allowance for loan losses:
Beginning Balance	923	389	265
Charge-offs	(16)	23	23
Recoveries	35	377	96
Provision (release)	(5)	180	51
Ending Balance	969	923	389
Ending balance: Individually evaluated for impairment	1
Ending balance: Collectively evaluated for impairment	968	923	389
Loans:
Ending balance		85,162	64,720
Ending balance	109,135
Ending balance: Individually evaluated for impairment	106	201	281
Ending balance: Collectively evaluated for impairment	108,284	$ 84,961	$ 64,439
Ending balance: Acquired and accounted for ASC 310-30	$ 745

Other Real Estate Owned (Detail

Other Real Estate Owned (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Activity in the other real estate owned (OREO) portfolio, net of valuation reserve
Balance at beginning of period	$ 8,371	$ 11,916	$ 19,141
Property additions	3,316	3,796	1,785
Property improvements	59		16
Less: Property disposals, net of gains/losses	3,990	5,633	7,456
Less: Period valuation adjustments	581	1,708	1,570
Balance at end of period	7,175	8,371	11,916
Activity in the valuation allowance
Balance at beginning of period	8,208	9,982	14,127
Provision for unrealized losses	581	1,708	1,570
Reductions taken on sales	(762)	(3,482)	(5,867)
Other adjustments			152
Balance at end of period	8,027	8,208	9,982
Expenses related to foreclosed assets, net of lease revenue
Gain on sales, net	(792)	(474)	(374)
Provision for unrealized losses	581	1,708	1,570
Operating expenses	649	1,227	1,765
Less: Lease revenue	42	296	218
Expenses related to OREO, net of lease revenue	$ 396	$ 2,165	$ 2,743

Premises and Equipment (Details

Premises and Equipment (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Premises and equipment
Cost	$ 107,845	$ 100,689
Accumulated Depreciation/Amortization	65,406	63,061
Net Book Value	42,439	37,628
Land
Premises and equipment
Cost	18,501	16,124
Net Book Value	18,501	16,124
Buildings
Premises and equipment
Cost	43,376	41,499
Accumulated Depreciation/Amortization	23,913	22,935
Net Book Value	19,463	18,564
Leasehold improvements
Premises and equipment
Cost	710	156
Accumulated Depreciation/Amortization	246	144
Net Book Value	464	12
Furniture and equipment
Premises and equipment
Cost	45,258	42,910
Accumulated Depreciation/Amortization	41,247	39,982
Net Book Value	$ 4,011	$ 2,928

Deposits - Components and Matur

Deposits - Components and Maturities (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Deposits
Noninterest bearing demand	$ 618,830	$ 572,404
Savings	304,400	262,220
NOW accounts	425,878	429,448
Money market accounts	310,390	276,082
Certificates of deposit of less than $100,000	230,781	216,493
Certificates of deposit of $100,000 up to $250,000	159,953	122,489
Certificates of deposit of $250,000 or more	66,441	43,789
Total deposits	$ 2,116,673	$ 1,922,925

Deposits - Scheduled maturities

Deposits - Scheduled maturities (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017	Oct. 28, 2016
Time	$ 457,175	$ 382,771
Noninterest bearing demand	618,830	572,404
Brokered certificates
Brokered certificates of deposit	30,400	18,800
Deposits held by senior officers and directors, including their related interests	1,600	2,600
Time Deposit Maturities
2,019	276,349
2,020	124,857
2,021	38,036
2,022	8,206
2,023	9,727
Total	457,175	$ 382,771
Talmer
Deposits			$ 48,900
GCFC/ABC Bank
Deposits	248,500
Time	99
Savings, NOW and money market	91,500
Noninterest bearing demand	58
Time Deposit Maturities
Total	$ 99

Borrowings - Summary (Details)

Borrowings - Summary (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Borrowings
Senior Notes	$ 44,158	$ 44,058
Total borrowings	313,355	246,615
Securities sold under repurchase agreements
Borrowings
Total borrowings	46,632	29,918
FHLBC advances
Borrowings
Total borrowings	149,500	115,000
Junior subordinated debentures
Borrowings
Total borrowings	57,686	57,639
Senior Notes.
Borrowings
Total borrowings	44,158	$ 44,058
Notes payable and other borrowings
Borrowings
Total borrowings	$ 15,379

Borrowings - Additional informa

Borrowings - Additional information (Details)	12 Months Ended
	Dec. 31, 2018USD ($)item	Dec. 31, 2017USD ($)	Apr. 20, 2018USD ($)
Borrowings
Threshold percentage of stockholders' equity	10.00%
Borrowings at FHLBC as percentage of total assets	35.00%
Bank owned FHLBC stock	$ 7,200,000	$ 5,400,000
Fair value of securities collateralized	77,600,000
Principal balance of loans collateralized	306,200,000
Maximum borrowing capacity	304,000,000
Amount available for additional borrowings	69,600,000
Senior notes	44,158,000	44,058,000
Debt issuance costs	692,000	739,000
Total borrowings	313,355,000	246,615,000
GCFC/ABC Bank
Borrowings
FHLBC advance amount	15,400,000
Subordinated Debt.	$ 304,800,000		$ 6,600,000
Debt Instrument, Term	7 years 3 months
Debt assumed	$ 23,400,000
GCFC/ABC Bank | Minimum
Borrowings
Interest rate (as a percent)	1.40%
GCFC/ABC Bank | Maximum
Borrowings
Interest rate (as a percent)	2.83%
Securities sold under repurchase agreements
Borrowings
Carrying amount of securities secured	$ 46,600,000	29,900,000
Fair value of the pledged collateral	$ 72,800,000	40,000,000
Number of customers having secured balances exceeding specified percentage of stockholders equity | item	0
Total borrowings	$ 46,632,000	29,918,000
Securities sold under repurchase agreements | Minimum
Borrowings
Maturity	1 day
Securities sold under repurchase agreements | Maximum
Borrowings
Maturity	90 days
FHLBC advances
Borrowings
FHLBC advance amount	$ 149,500,000	115,000,000
Total borrowings	$ 149,500,000	$ 115,000,000
FHLB advances at 1.42 %
Borrowings
Interest rate (as a percent)	2.52%	1.42%
FHLBC advance amount	$ 130,000,000	$ 110,000,000
FHLB advances at 1.44 %
Borrowings
Interest rate (as a percent)	1.95%	1.44%
FHLBC advance amount	$ 15,500,000	$ 5,000,000
Notes payable and other borrowings
Borrowings
Total borrowings	15,379,000
Junior subordinated debentures
Borrowings
Total borrowings	$ 57,686,000	57,639,000
Senior Notes.
Borrowings
Interest rate (as a percent)	5.75%
Debt Instrument, Term	10 years
Interest rate term	5 years
Debt issuance costs	$ 842,000	$ 942,000
Amortization period for deferred financing costs		10 years
Total borrowings	$ 44,158,000	$ 44,058,000
Senior Notes. | Three month LIBOR
Borrowings
Basis points added to reference rate (as a percent)	385.00%

Borrowings - Maturities and Wei

Borrowings - Maturities and Weighted Average Rates (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Scheduled maturities and weighted average rates of borrowings
Year one	$ 196,132	$ 144,918
Year two	8,500
Thereafter	108,723	101,697
Total	$ 313,355	$ 246,615
Weighted Average Rate
Year one (as a percent)	1.78%	0.86%
Year two (as a percent)	2.05%
Thereafter (as a percent)	6.07%	6.01%
Total (as a percent)	3.28%	2.98%

Junior Subordinated Debentures

Junior Subordinated Debentures - Issuance (Details) $ in Thousands	Dec. 31, 2018USD ($)	Apr. 30, 2007USD ($)	Jul. 31, 2003USD ($)	Jun. 30, 2003USD ($)	Jun. 15, 2017	Dec. 31, 2017USD ($)	Dec. 31, 2018USD ($)item	Dec. 31, 2017USD ($)
Junior subordinated debentures
Junior subordinated debentures	$ 57,686					$ 57,639	$ 57,686	$ 57,639
Junior Subordinated Debentures issuance cost	$ 692					$ 739	$ 692	$ 739
Old Second Capital Trust I
Junior subordinated debentures
Proceeds from sale of cumulative trust preferred securities			$ 4,100	$ 27,500
Maturity Period							30 years
Cash distribution rate of trust preferred securities (as a percent)							7.80%
Amortization period							30 years
Old Second Capital Trust II
Junior subordinated debentures
Proceeds from sale of cumulative trust preferred securities		$ 25,000
Maturity Period							30 years
Cash distribution fixed rate of trust preferred securities (as a percent)	4.37%				6.77%			4.30%
Basis points added to cash distribution floating rate base (as a percent)						1.50%
Cash distribution, floating rate base							three-month LIBOR
Junior subordinated debentures
Junior subordinated debentures
Interest Payment Deferment Period | item							20
Junior subordinated debentures | Old Second Capital Trust I
Junior subordinated debentures
Junior subordinated debentures	$ 32,600						$ 32,600
Junior subordinated debentures | Old Second Capital Trust II
Junior subordinated debentures
Junior subordinated debentures	$ 25,800						$ 25,800

Income Taxes - Components (Deta

Income Taxes - Components (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Components of income tax expense (benefit)
Current federal		$ (2,407)	$ 399
Current state	$ 84
Deferred federal	6,226	11,724	6,824
Deferred state	3,614	372	1,597
Expense due to enactment of federal tax reform		9,475
Total income tax expenses	9,924	19,164	$ 8,820
Deferred tax assets
Allowance for loan losses	5,803	5,377
Deferred compensation	665	650
Amortization of core deposit intangible		827
Goodwill amortization/impairment	4,698	6,087
Stock based compensation	1,377	866
Business combination adjustments	2,532
OREO write downs	2,337	2,385
Federal net operating loss ("NOL") carryforward	2,199	7,240
State net operating loss ("NOL") carryforward	4,034	7,020
Other assets	1,401	1,017
Total deferred tax assets	25,046	31,469
Deferred tax liabilities
Accumulated depreciation on premises and equipment	(443)	(384)
Mortgage servicing rights	(2,210)	(2,086)
Amortization of core deposit intangible	(130)
State tax benefits	(1,839)	(2,389)
Other liabilities	(741)	(545)
Total deferred tax liabilities	(5,363)	(5,404)
Net deferred tax asset before valuation allowance	19,683	26,065
Tax effect of adjustments related to other comprehensive loss	1,597	(709)
Net deferred tax asset	$ 21,280	$ 25,356
Corporate federal tax rate	21.00%	35.00%

Income Taxes - Carryforwards (D

Income Taxes - Carryforwards (Details) $ in Millions	Dec. 31, 2018USD ($)
Alternative minimum tax credit
Net operating loss carryforward
Alternative minimum tax credit that can be carried forward	$ 2.6
Federal
Net operating loss carryforward
Net operating loss carryforward	7.6
State
Net operating loss carryforward
Net operating loss carryforward	39.9
State | 2025
Net operating loss carryforward
Net operating loss carryforward	$ 39.7

Income Taxes - Components of De

Income Taxes - Components of Deferred Income Tax Provision (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Components of the provision for deferred income taxes
Provision for loan losses	$ (426)	$ 1,680	$ 42
Deferred compensation	(15)	85	(45)
Amortization of core deposit intangible	957	574	228
Stock option compensation	(511)	80	(132)
Business combination adjustments	927
OREO write downs	48	2,725	1,807
Federal net operating loss carryforward	5,041	12,122	4,743
State net operating loss carryforward	2,986	715	1,011
Deferred tax credit		2,058	(309)
Depreciation	59	(297)	80
Mortgage servicing rights	124	(674)	276
Goodwill amortization/impairment	1,389	4,040	1,496
State tax benefits	(550)	(1,738)	(559)
Other, net	(189)	201	(217)
Total deferred tax benefit	9,840	21,571	8,421
Difference between effective tax rates and federal statutory rates applied to financial statement income
Tax at statutory federal income tax rate	9,227	11,817	8,577
Nontaxable interest income, net of disallowed interest deduction	(1,600)	(1,976)	(347)
BOLI Income	(422)	(501)	(449)
State income taxes, net of federal benefit	2,927	1,775	1,148
Stock based compensation	(305)
Impact of Federal tax rate change		9,475
Impact of Illinois tax rate change		(1,566)
Other, net	97	140	(109)
Total income tax expenses	9,924	19,164	8,820
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Extraordinary Items, Noncontrolling Interest	$ 43,936	$ 34,302	$ 24,504

Equity Compensation Plans - Opt

Equity Compensation Plans - Options (Details) - USD ($)	Dec. 31, 2018	Dec. 31, 2009	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	May 31, 2016	Dec. 31, 2015
Equity Compensation Plans
Term of stock options granted	10 years
Vesting period	3 years
Shares
Exercised (in shares)			$ (33,000)		$ (11,000)
2009 Plan
Equity Compensation Plans
Granted (in shares)		16,500
Exercised (in shares)			4,500	0	1,500
Shares
Ending outstanding (in shares)	4,500		4,500
Stock options
Equity Compensation Plans
Total unrecognized compensation cost	$ 0		$ 0
Shares
Beginning outstanding (in shares)			9,000
Exercised (in shares)			$ (4,500)
Ending outstanding (in shares)	4,500		4,500	9,000
Exercisable at end of period (in shares)	4,500		4,500
Weighted Average Exercise Price
Beginning outstanding (in dollars per share)			$ 7.49
Exercised (in dollars per share)			7.49
Ending outstanding (in dollars per share)	$ 7.49		7.49	$ 7.49
Exercisable at end of period (in dollars per share)	$ 7.49		$ 7.49
Weighted Average Remaining Contractual Term (years)
Ending outstanding (in years)			1 month 6 days	1 year 1 month 6 days
Exercisable at end of period			1 month 6 days
Aggregate Intrinsic Value
Exercised (in dollars)			$ (27,000)		$ (3,000)
Ending outstanding (in dollars)	$ 25,000		25,000	$ 55,000
Exercisable at the end of the period (in dollars)	$ 25,000		$ 25,000
Stock options | 2014 Plan
Equity Compensation Plans
Number of shares authorized						975,000	375,000

Equity Compensation Plans - Sum

Equity Compensation Plans - Summary of stock option activity (Details) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	May 31, 2016	Dec. 31, 2015
Summary Of Stock Option Activity [Abstract]
Cash received from options exercised	$ 33,000		$ 11,000
Stock based compensation	2,257,000	$ 1,181,000	657,000
Stock options
Summary Of Stock Option Activity [Abstract]
Intrinsic value of options exercised	27,000		3,000
Cash received from options exercised	33,000		$ 11,000
Tax benefit realized from option exercises	$ 5,000
Stock options | 2014 Plan
Summary Of Stock Option Activity [Abstract]
Number of shares authorized				975,000	375,000
Number of additional shares authorised in amendment				600,000
Number of shares issuable	169,791

Equity Compensation Plans - Res

Equity Compensation Plans - Restricted Stock and RSUs (Details) - Restricted stock and restricted stock units - USD ($) $ / shares in Units, $ in Millions	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Changes in unvested awards
Nonvested at the beginning of the period (in shares)	465,000
Granted (in shares)	254,281	161,500
Vested (in shares)	(167,000)
Nonvested at the end of the period (in shares)	552,281	465,000
Weighted Average Grant Date Fair Value
Nonvested at the beginning of the period (in dollars per share)	$ 7.79
Granted (in dollars per share)	13.98
Vested (in dollars per share)	5.60
Nonvested at the end of the period (in dollars per share)	$ 11.31	$ 7.79
Additional information
Total unrecognized compensation cost of restricted awards	$ 3
Expected weighted-average period for recognition of unrecognized compensation	1 year 9 months 18 days

Earnings Per Share - Reconcilia

Earnings Per Share - Reconciliation (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Basic earnings per share:
Weighted-average common shares outstanding	29,728,308	29,600,702	29,532,510
Net income	$ 34,012	$ 15,138	$ 15,684
Basic earnings per share (in dollars per share)	$ 1.14	$ 0.51	$ 0.53
Diluted earnings per share:
Weighted-average common shares outstanding	29,728,308	29,600,702	29,532,510
Diluted average common shares outstanding	30,308,935	30,038,417	29,838,931
Net earnings available to common stockholders	$ 34,012	$ 15,138	$ 15,684
Diluted earnings per share (in dollars per share)	$ 1.12	$ 0.50	$ 0.53
Antidilutive securities		815,339	900,839
Warrants
Diluted earnings per share:
Antidilutive securities		815,339	815,339
Warrants, exercise price (in dollars per share)		$ 13.43	$ 13.43
Restricted stock and restricted stock units
Diluted earnings per share:
Dilutive effect of share-based payment awards (in shares)	532,692	435,142	305,678
Stock options
Diluted earnings per share:
Dilutive effect of share-based payment awards (in shares)	47,935	2,573	743

Commitments - Summary of Financ

Commitments - Summary of Financial Instrument Commitments (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Fixed
Financial instrument commitments
Financial instrument commitments	$ 859	$ 418
Fixed | Borrower
Financial instrument commitments
Financial instrument commitments	859	418
Fixed | Borrower | Financial standby
Financial instrument commitments
Financial instrument commitments	327	177
Fixed | Borrower | Performance standby
Financial instrument commitments
Financial instrument commitments	532	241
Fixed | Unused lines of Credit
Financial instrument commitments
Loan commitments	89,303	82,942
Variable
Financial instrument commitments
Financial instrument commitments	14,003	11,860
Variable | Borrower
Financial instrument commitments
Financial instrument commitments	13,936	11,718
Variable | Borrower | Financial standby
Financial instrument commitments
Financial instrument commitments	7,158	3,770
Variable | Borrower | Commercial standby
Financial instrument commitments
Financial instrument commitments	397	354
Variable | Borrower | Performance standby
Financial instrument commitments
Financial instrument commitments	6,381	7,594
Variable | Nonborrower | Performance standby
Financial instrument commitments
Financial instrument commitments	67	142
Variable | Unused lines of Credit
Financial instrument commitments
Loan commitments	297,785	260,061
Total.
Financial instrument commitments
Financial instrument commitments	14,862	12,278
Total. | Borrower
Financial instrument commitments
Financial instrument commitments	14,795	12,136
Total. | Borrower | Financial standby
Financial instrument commitments
Financial instrument commitments	7,485	3,947
Total. | Borrower | Commercial standby
Financial instrument commitments
Financial instrument commitments	397	354
Total. | Borrower | Performance standby
Financial instrument commitments
Financial instrument commitments	6,913	7,835
Total. | Nonborrower | Performance standby
Financial instrument commitments
Financial instrument commitments	67	142
Total. | Unused lines of Credit
Financial instrument commitments
Loan commitments	$ 387,088	$ 343,003

Commitments - Lease Commitments

Commitments - Lease Commitments and Legal Proceedings (Details) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Estimated aggregate minimum annual rental commitments
2,019	$ 534,000
2,020	478,000
2,021	482,000
2,022	368,000
2,023	336,000
2,024	346,000
Aggregate future minimum rental income receivable under noncancelable leases	123,000
Total facility net operating lease revenue/expense	180,000	$ 64,000	$ 25,000
Total ATM lease expense	979,000	$ 679,000	$ 685,000
GCFC/ABC Bank
Estimated aggregate minimum annual rental commitments
Total ATM lease expense	$ 208,000

Regulatory & Capital Matters (D

Regulatory & Capital Matters (Details)	Dec. 31, 2018	Dec. 31, 2017
Regulatory & Capital Matters
Tier 1 capital leverage ratio (as a percent)	10.08%	10.08%
Risk-based capital ratio (as a percent)	12.63%	12.93%
Old Second National Bank
Regulatory & Capital Matters
Tier 1 capital leverage ratio (as a percent)	11.36%	10.79%
Risk-based capital ratio (as a percent)	14.14%	13.78%
Minimum | Old Second National Bank
Regulatory & Capital Matters
Tier 1 capital leverage ratio (as a percent)	8.00%
Risk-based capital ratio (as a percent)	12.00%

Regulatory & Capital Matters -

Regulatory & Capital Matters - Capital Levels and Industry Defined Regulatory Minimums (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Common equity tier 1 capital to risk weighted assets
Actual	$ 207,597	$ 179,853
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable	$ 142,444	$ 111,801
Common equity tier 1 capital to risk weighted assets, Ratio
Actual (as a percent)	9.29%	9.25%
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable (as a percent)	6.375%	5.75%
Total capital to risk weighted assets, Amount
Actual at period end	$ 282,126	$ 251,383
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable	$ 220,648	$ 179,837
Total capital to risk weighted assets, Ratio
Risk-based capital ratio (as a percent)	12.63%	12.93%
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable (as a percent)	9.875%	9.25%
Tier 1 capital to risk weighted assets, Amount
Actual	$ 263,125	$ 233,927
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable	$ 175,960	$ 140,978
Tier 1 capital to risk weighted assets, Ratio
Actual (as a percent)	11.78%	12.03%
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable (as a percent)	7.875%	7.25%
Tier 1 capital to average assets, Amount
Actual	$ 263,125	$ 233,927
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable	$ 104,415	$ 92,828
Tier 1 capital to average assets, Ratio
Tier 1 capital leverage ratio (as a percent)	10.08%	10.08%
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable (as a percent)	4.00%	4.00%
Old Second National Bank
Common equity tier 1 capital to risk weighted assets
Actual	$ 295,599	$ 249,417
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable	141,791	111,347
Minimum Required to Be Well Capitalized	$ 144,571	$ 125,870
Common equity tier 1 capital to risk weighted assets, Ratio
Actual (as a percent)	13.29%	12.88%
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable (as a percent)	6.375%	5.75%
Minimum Required to Be Well Capitalized (as a percent)	6.50%	6.50%
Total capital to risk weighted assets, Amount
Actual at period end	$ 314,600	$ 266,873
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable	219,637	179,142
Minimum Required to Be Well Capitalized	$ 222,417	$ 193,667
Total capital to risk weighted assets, Ratio
Risk-based capital ratio (as a percent)	14.14%	13.78%
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable (as a percent)	9.875%	9.25%
Minimum Required to Be Well Capitalized (as a percent)	10.00%	10.00%
Tier 1 capital to risk weighted assets, Amount
Actual	$ 295,599	$ 249,417
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable	175,153	140,394
Minimum Required to Be Well Capitalized	$ 177,934	$ 154,917
Tier 1 capital to risk weighted assets, Ratio
Actual (as a percent)	13.29%	12.88%
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable (as a percent)	7.875%	7.25%
Minimum Required to Be Well Capitalized (as a percent)	8.00%	8.00%
Tier 1 capital to average assets, Amount
Actual	$ 295,599	$ 249,417
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable	104,084	92,462
Minimum Required to Be Well Capitalized	$ 130,105	$ 115,578
Tier 1 capital to average assets, Ratio
Tier 1 capital leverage ratio (as a percent)	11.36%	10.79%
Minimum Required for Capital Adequacy Purposes with Capital Conservation Buffer if applicable (as a percent)	4.00%	4.00%
Minimum Required to Be Well Capitalized (as a percent)	5.00%	5.00%

Regulatory & Capital Matters _2

Regulatory & Capital Matters - Dividend Restrictions and Deferrals (Details)	12 Months Ended
	Dec. 31, 2018
Dividend Restrictions and Deferrals
Number of previous years retained profit considered for dividend payment	2 years
Minimum capital requirements, minimum percentage required, 2016	0.625%
Minimum capital requirements, minimum percentage required, 2017	1.25%
Minimum capital requirements, minimum percentage required, 2018	1.875%
Minimum capital requirements, minimum percentage required, 2019 and thereafter	2.50%

Mortgage Banking Derivatives (D

Mortgage Banking Derivatives (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Mortgage Banking Derivatives
Amount of loans sold to investors	$ 133,900
Proceeds from sale of loan to investors	137,622	$ 151,289	$ 197,654
Gain on sale of loan	3,791	4,803	$ 6,343
Federal National Mortgage Association
Mortgage Banking Derivatives
Amount of loans sold to investors	$ 93,900
Federal National Mortgage Association | Customer concentration risk
Mortgage Banking Derivatives
Percentage of concentration risk	69.40%
Federal Home Loan Mortgage Corp.
Mortgage Banking Derivatives
Amount of loans sold to investors	$ 14,800
Federal Home Loan Mortgage Corp. | Customer concentration risk
Mortgage Banking Derivatives
Percentage of concentration risk	11.00%
Not designated | Forward MBS contracts and forward loan contracts
Mortgage Banking Derivatives
Notional or Contractual Amount	$ 9,315	16,500
Fair value	(50)	3
Not designated | Rate Lock Commitments
Mortgage Banking Derivatives
Notional or Contractual Amount	8,815	10,478
Fair value	$ 209	$ 235

Fair Value Measurements - Recur

Fair Value Measurements - Recurring (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Assets:
Securities available-for-sale	$ 541,248	$ 541,439
Mortgage servicing rights	7,357	6,944
U.S. Treasury
Assets:
Securities available-for-sale	3,923	3,947
U.S. government agencies
Assets:
Securities available-for-sale		13,061
States and political subdivisions
Assets and liabilities measured at fair value on a recurring basis
Purchases	22,046	16,712
Assets:
Securities available-for-sale	274,067	278,092
Corporate bonds
Assets:
Securities available-for-sale		833
Collateralized mortgage obligations
Assets:
Securities available-for-sale	64,429	65,939
Asset-backed securities
Assets:
Securities available-for-sale	109,514	112,932
Collateralized loan obligations
Assets:
Securities available-for-sale	64,289	54,421
Level 1
Assets:
Securities available-for-sale	3,923	3,947
Level 2
Assets:
Securities available-for-sale	529,160	520,963
Loans held-for-sale	2,984	4,067
Level 2 | Interest rate swap agreements net of swap credit valuation
Liabilities:
Other liabilities	58	1,287
Level 3
Assets:
Securities available-for-sale	8,165	16,529
Recurring
Assets:
Loans held-for-sale	2,984	4,067
Mortgage servicing rights	7,357	6,944
Total financial assets	552,420	553,415
Liabilities:
Total	672	2,014
Recurring | Interest rate swap agreements net of swap credit valuation
Assets:
Other assets	672	727
Liabilities:
Other liabilities	672	2,014
Recurring | Forward MBS contracts and forward loan contracts
Assets:
Other assets	159	238
Recurring | U.S. Treasury
Assets:
Securities available-for-sale	3,923	3,947
Recurring | U.S. government agencies
Assets:
Securities available-for-sale	10,951	13,061
Recurring | U.S. government agency mortgage-backed
Assets:
Securities available-for-sale	14,075	12,214
Recurring | States and political subdivisions
Assets:
Securities available-for-sale	274,067	278,092
Recurring | Corporate bonds
Assets:
Securities available-for-sale		833
Recurring | Collateralized mortgage obligations
Assets:
Securities available-for-sale	64,429	65,939
Recurring | Asset-backed securities
Assets:
Securities available-for-sale	109,514	112,932
Recurring | Collateralized loan obligations
Assets:
Securities available-for-sale	64,289	54,421
Recurring | Level 1
Assets:
Total financial assets	3,923	3,947
Recurring | Level 1 | U.S. Treasury
Assets:
Securities available-for-sale	3,923	3,947
Recurring | Level 2
Assets:
Loans held-for-sale	2,984	4,067
Total financial assets	532,975	525,995
Liabilities:
Total	672	2,014
Recurring | Level 2 | Interest rate swap agreements net of swap credit valuation
Assets:
Other assets	672	727
Liabilities:
Other liabilities	672	2,014
Recurring | Level 2 | Forward MBS contracts and forward loan contracts
Assets:
Other assets	159	238
Recurring | Level 2 | U.S. government agencies
Assets:
Securities available-for-sale	10,951	13,061
Recurring | Level 2 | U.S. government agency mortgage-backed
Assets:
Securities available-for-sale	14,075	12,214
Recurring | Level 2 | States and political subdivisions
Assets:
Securities available-for-sale	265,902	263,831
Recurring | Level 2 | Corporate bonds
Assets:
Securities available-for-sale		833
Recurring | Level 2 | Collateralized mortgage obligations
Assets:
Securities available-for-sale	64,429	63,671
Recurring | Level 2 | Asset-backed securities
Assets:
Securities available-for-sale	109,514	112,932
Recurring | Level 2 | Collateralized loan obligations
Assets:
Securities available-for-sale	64,289	54,421
Recurring | Level 3
Assets:
Mortgage servicing rights	7,357	6,944
Total financial assets	15,522	23,473
Recurring | Level 3 | States and political subdivisions
Assets:
Securities available-for-sale	$ 8,165	14,261
Recurring | Level 3 | Collateralized mortgage obligations
Assets:
Securities available-for-sale		$ 2,268

Fair Value Measurements - Chang

Fair Value Measurements - Changes in Level 3 (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Collateralized loan obligations
Changes in Level 3
Beginning balance	$ 2,268	$ 3,119
Transfers out of Level 3	(1,308)
Total gains or losses
Included in earnings (or changes in net assets)	35	40
Included in other comprehensive income	40	21
Purchases, issuances, sales, and settlements
Settlements	(1,035)	(912)
Ending balance		2,268
States and political subdivisions
Changes in Level 3
Beginning balance	14,261	22,226
Total gains or losses
Included in other comprehensive income	(746)	(796)
Purchases, issuances, sales, and settlements
Purchases	22,046	16,712
Settlements	(27,396)	(23,881)
Ending balance	8,165	14,261
Mortgage servicing rights
Changes in Level 3
Beginning balance	6,944	6,489
Total gains or losses
Included in earnings (or changes in net assets)	(181)	(270)
Purchases, issuances, sales, and settlements
Issuances	1,146	1,257
Settlements	(552)	(532)
Ending balance	$ 7,357	$ 6,944

Fair Value Measurements - Quant

Fair Value Measurements - Quantitative and Qualitative Information (Details) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Quantitative information about Level 3 fair value measurements
Mortgage servicing rights, fair value	$ 7,357,000	$ 6,944,000
Securities available-for-sale, at fair value	541,248,000	541,439,000
Level 3
Quantitative information about Level 3 fair value measurements
Securities available-for-sale, at fair value	8,165,000	16,529,000
States and political subdivisions
Quantitative information about Level 3 fair value measurements
Securities available-for-sale, at fair value	274,067,000	278,092,000
Collateralized mortgage obligations
Quantitative information about Level 3 fair value measurements
Securities available-for-sale, at fair value	64,429,000	65,939,000
Recurring
Quantitative information about Level 3 fair value measurements
Mortgage servicing rights, fair value	7,357,000	6,944,000
Recurring | Level 3
Quantitative information about Level 3 fair value measurements
Mortgage servicing rights, fair value	7,357,000	6,944,000
Recurring | States and political subdivisions
Quantitative information about Level 3 fair value measurements
Securities available-for-sale, at fair value	274,067,000	278,092,000
Recurring | States and political subdivisions | Level 3
Quantitative information about Level 3 fair value measurements
Securities available-for-sale, at fair value	8,165,000	14,261,000
Recurring | Collateralized mortgage obligations
Quantitative information about Level 3 fair value measurements
Securities available-for-sale, at fair value	64,429,000	65,939,000
Recurring | Collateralized mortgage obligations | Level 3
Quantitative information about Level 3 fair value measurements
Securities available-for-sale, at fair value		2,268,000
Recurring | Measurement Input, Discount Rate | Mortgage servicing rights | Discounted Cash Flow | Level 3
Quantitative information about Level 3 fair value measurements
Mortgage servicing rights, fair value	$ 7,357,000	$ 6,944,000
Recurring | Measurement Input, Discount Rate | Mortgage servicing rights | Discounted Cash Flow | Level 3 | Minimum
Quantitative information about Level 3 fair value measurements
Servicing Asset, Measurement Input	10	10
Recurring | Measurement Input, Discount Rate | Mortgage servicing rights | Discounted Cash Flow | Level 3 | Maximum
Quantitative information about Level 3 fair value measurements
Servicing Asset, Measurement Input	229.7	34.3
Recurring | Measurement Input, Discount Rate | Mortgage servicing rights | Discounted Cash Flow | Level 3 | Weighted Average
Quantitative information about Level 3 fair value measurements
Servicing Asset, Measurement Input	10.2	10.2
Recurring | Measurement Input, Constant Prepayment Rate | Mortgage servicing rights | Discounted Cash Flow | Level 3 | Minimum
Quantitative information about Level 3 fair value measurements
Servicing Asset, Measurement Input	7	7
Recurring | Measurement Input, Constant Prepayment Rate | Mortgage servicing rights | Discounted Cash Flow | Level 3 | Maximum
Quantitative information about Level 3 fair value measurements
Servicing Asset, Measurement Input	68.9	68.4
Recurring | Measurement Input, Constant Prepayment Rate | Mortgage servicing rights | Discounted Cash Flow | Level 3 | Weighted Average
Quantitative information about Level 3 fair value measurements
Servicing Asset, Measurement Input	9.6	9.6

Fair Value Measurements - Nonre

Fair Value Measurements - Nonrecurring (Details) - USD ($)	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Assets and liabilities measured at fair value
Valuation allowance	$ 352,000	$ 144,000
Carrying value of other real estate owned	7,175,000	8,371,000	$ 11,916,000	$ 19,141,000
OREO Valuation allowance	8,027,000	8,208,000	$ 9,982,000	$ 14,127,000
Impaired loans
Assets and liabilities measured at fair value
Valuation allowance		5,300,000
Nonrecurring
Assets and liabilities measured at fair value
Total	19,338,000	13,484,000
Nonrecurring | Impaired loans
Assets and liabilities measured at fair value
Total	12,163,000	5,113,000
Valuation allowance	12,500,000
Increase (decrease) of specific allocations within the provision for loan losses	208,000	(856,000)
Nonrecurring | Other real estate owned
Assets and liabilities measured at fair value
Total	7,175,000	8,371,000
Carrying value of other real estate owned	7,200,000	8,400,000
Outstanding balance	16,100,000	17,400,000
OREO Valuation allowance	8,000,000	8,200,000
OREO participations	900,000	900,000
Nonrecurring | Level 3
Assets and liabilities measured at fair value
Total	19,338,000	13,484,000
Nonrecurring | Level 3 | Impaired loans
Assets and liabilities measured at fair value
Total	12,163,000	5,113,000
Nonrecurring | Level 3 | Other real estate owned
Assets and liabilities measured at fair value
Total	$ 7,175,000	$ 8,371,000

Fair Values of Financial Inst_3

Fair Values of Financial Instruments (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Financial assets:
Cash and due from banks	$ 38,599	$ 37,444
Interest bearing deposits with financial institutions	16,636	18,389
Securities available-for-sale	541,248	541,439
FHLBC and FRBC Stock	13,433	10,168
Bank-owned life insurance	61,544	61,764
Financial liabilities:
Noninterest bearing deposits	618,830	572,404
Other short-term borrowings	149,500	115,000
Junior subordinated debentures	57,686	57,639
Carrying Amount
Financial assets:
Cash and due from banks	38,599	37,444
Interest bearing deposits with financial institutions	16,636	18,389
Securities available-for-sale	541,248	541,439
FHLBC and FRBC Stock	13,433	10,168
Loans held for sale	2,984	4,067
Net loans	1,878,021	1,600,161
Accrued interest receivable	10,940	8,595
Financial liabilities:
Noninterest bearing deposits	618,830	572,404
Interest bearing deposits	1,497,843	1,350,521
Securities sold under repurchase agreements	46,632	29,918
Other short-term borrowings	149,500	115,000
Junior subordinated debentures	57,686	57,639
Senior notes	44,158	44,058
Note payable and other borrowings	15,379
Borrowing interest payable	281	140
Deposit interest payable	973	631
Total Fair Value
Financial assets:
Cash and due from banks	38,599	37,444
Interest bearing deposits with financial institutions	16,636	18,389
Securities available-for-sale	541,248	541,439
FHLBC and FRBC Stock	13,433	10,168
Loans held for sale	2,984	4,067
Net loans	1,867,594	1,586,722
Accrued interest receivable	10,940	8,595
Financial liabilities:
Noninterest bearing deposits	618,830	572,404
Interest bearing deposits	1,495,614	1,346,339
Securities sold under repurchase agreements	46,632	29,918
Other short-term borrowings	149,500	115,000
Junior subordinated debentures	47,625	59,471
Senior notes	45,008	46,743
Note payable and other borrowings	18,050
Borrowing interest payable	281	140
Deposit interest payable	973	631
Level 1
Financial assets:
Cash and due from banks	38,599	37,444
Interest bearing deposits with financial institutions	16,636	18,389
Securities available-for-sale	3,923	3,947
Financial liabilities:
Noninterest bearing deposits	618,830	572,404
Junior subordinated debentures	32,989	33,267
Senior notes	45,008	46,743
Level 2
Financial assets:
Securities available-for-sale	529,160	520,963
FHLBC and FRBC Stock	13,433	10,168
Loans held for sale	2,984	4,067
Accrued interest receivable	10,940	8,595
Financial liabilities:
Interest bearing deposits	1,495,614	1,346,339
Securities sold under repurchase agreements	46,632	29,918
Other short-term borrowings	149,500	115,000
Junior subordinated debentures	14,636	26,204
Note payable and other borrowings	18,050
Borrowing interest payable	281	140
Deposit interest payable	973	631
Level 3
Financial assets:
Securities available-for-sale	8,165	16,529
Net loans	1,867,594	1,586,722
Interest rate swap agreements net of swap credit valuation | Carrying Amount
Financial liabilities:
Interest rate swap	58	1,287
Interest rate swap agreements net of swap credit valuation | Total Fair Value
Financial liabilities:
Interest rate swap	58	1,287
Interest rate swap agreements net of swap credit valuation | Level 2
Financial liabilities:
Interest rate swap	$ 58	$ 1,287

Financial Instruments with Of_3

Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions - Fair Value of Derivatives (Details)	12 Months Ended
	Dec. 31, 2018USD ($)item	Dec. 31, 2017USD ($)item
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions
Amount to be reclassified as a reduction to interest expense during the next twelve months	$ 24,000
Designated
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions
Derivative liabilities designated as hedging instruments, fair value	$ 58,000	$ 1,287,000
Designated | Interest Rate Products | OSBC Affiliates
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions
Derivative, number of transactions | item	1	1
Notional Amount	$ 25,774,000	$ 25,774,000
Derivative liabilities designated as hedging instruments, fair value	58,000	1,287,000
Not designated
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions
Derivative assets designated as hedging instruments, fair value	831,000	965,000
Derivative liabilities designated as hedging instruments, fair value	$ 698,000	$ 740,000
Not designated | Interest Rate Products | Commercial Loan Customers
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions
Derivative, number of transactions | item	25	23
Notional Amount	$ 188,931,000	$ 153,433,000
Derivative assets designated as hedging instruments, fair value	672,000	727,000
Derivative liabilities designated as hedging instruments, fair value	$ 672,000	$ 727,000
Weighted average maturity	6 years 7 months 6 days	6 years 7 months 6 days
Not designated | Interest rate swap agreements net of swap credit valuation
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions
Cash collateral pledged with financial institutions, dollars	$ 260,000	$ 0
Investment securities pledged with financial institutions, dollars	$ 0	$ 4,200,000
Number of correspondent financial institutions where investment securities are pledged	1	1
Not designated | Interest Rate Lock Commitments and Forward Contracts
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions
Derivative, number of transactions | item	63	93
Notional Amount	$ 18,130,000	$ 26,978,000
Derivative assets designated as hedging instruments, fair value	$ 159,000	$ 238,000
Not designated | Other Contracts
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions
Derivative, number of transactions | item	3	3
Notional Amount	$ 18,155,000	$ 15,959,000
Derivative liabilities designated as hedging instruments, fair value	26,000	13,000
Not designated | Forward MBS contracts and forward loan contracts
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions
Notional Amount	$ 9,315,000	$ 16,500,000

Financial Instruments with Of_4

Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions - Effect of Fair Value (Details) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Financial Instruments with Off-Balance Sheet Risk and Derivative Transactions
Amount of Gain or (Loss) Reclassified from Accumulated OCI into Income	$ 1,200,000	$ 59,000
Amount of Gain or (Loss) Recognized in Income on Derivative	$ (168,000)	$ (212,000)

Preferred Stock (Details)

Preferred Stock (Details) - USD ($) $ / shares in Units, $ in Millions	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2017	Mar. 31, 2009
Preferred Stock
Preferred stock, Shares authorized	300,000			300,000
Series B Stock
Preferred Stock
Fair value					$ 68.2
Shares redeemed (in shares)		73,000	73,000
Warrants
Preferred Stock
Warrants, term	10 years
Warrants to purchase the Company's common stock, initially authorized (in shares)	815,339
Warrants, exercise price (in dollars per share)	$ 13.43
Fair value					$ 4.8

Parent Company Condensed Fina_3

Parent Company Condensed Financial Information - Condensed Balance Sheets (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Assets
Other assets	$ 23,473	$ 22,776
Total assets	2,676,003	2,383,429
Liabilities and Stockholders' Equity
Other short-term borrowings	149,500	115,000
Junior subordinated debentures	57,686	57,639
Senior Notes	44,158	44,058
Other liabilities	16,894	13,539
Stockholders' equity	229,081	200,350	$ 175,210	$ 155,929
Total liabilities and stockholders' equity	2,676,003	2,383,429
Old Second Bancorp, Inc.
Assets
Noninterest bearing deposit with bank subsidiary	9,039	23,011
Investment in subsidiaries	315,252	263,389
Other assets	12,997	17,139
Total assets	337,288	303,539
Liabilities and Stockholders' Equity
Other short-term borrowings	4,000
Junior subordinated debentures	57,686	57,639
Senior Notes	44,158	44,058
Other liabilities	2,363	1,492
Stockholders' equity	229,081	200,350
Total liabilities and stockholders' equity	$ 337,288	$ 303,539

Parent Company Condensed Fina_4

Parent Company Condensed Financial Information - Condensed Statements of Income (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Operating Expenses
Junior subordinated debentures	$ 3,716	$ 4,002	$ 4,334
Senior notes	2,688	2,689	112
Subordinated debt			949
Income (loss) before income taxes and equity in undistributed net income of subsidiaries	43,936	34,302	24,504
Income tax benefit	9,924	19,164	8,820
Net income available to common stockholders	34,012	15,138	15,684
Old Second Bancorp, Inc.
Operating Income
Cash dividends received from subsidiaries	30,000
Other income	106	114	130
Total operating income	30,106	114	130
Operating Expenses
Junior subordinated debentures	3,716	4,002	4,334
Senior notes	2,688	2,689	112
Subordinated debt			949
Other interest expense	98		8
Other expenses	4,208	2,639	1,975
Total operating expense	10,710	9,330	7,378
Income (loss) before income taxes and equity in undistributed net income of subsidiaries	19,396	(9,216)	(7,248)
Income tax benefit	(3,355)	(16)	(2,909)
Income (loss) before equity in undistributed net income of subsidiaries	22,751	(9,200)	(4,339)
Equity in undistributed net income of subsidiaries	11,261	24,338	20,023
Net income available to common stockholders	$ 34,012	$ 15,138	$ 15,684

Parent Company Condensed Fina_5

Parent Company Condensed Financial Information -Condensed Statements of Cash Flows (Details) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Cash Flows from Operating Activities
Net income	$ 34,012,000	$ 15,138,000	$ 15,684,000
Adjustments to reconcile net income (loss) to net cash from operating activities:
Provision for deferred tax expense (benefit)	9,840,000	21,571,000	8,421,000
Net deferred tax expense due to DTA revaluation	9,840,000	13,662,000	8,421,000
Change in taxes payable	1,678,000	(2,519,000)	260,000
Stock-based compensation	2,257,000	1,181,000	657,000
Net cash provided by operating activities	54,907,000	37,105,000	27,256,000
Cash paid for acquisition, net of cash and cash equivalent retained	(35,711,000)		(181,357,000)
Net cash provided by (used in) investing activities	(25,841,000)	(132,487,000)	(123,073,000)
Cash Flows from Financing Activities
Net change in other short-term borrowings	23,625,000	45,000,000	55,000,000
Dividends paid common stock	(1,189,000)	(1,184,000)	(888,000)
Purchases of treasury stock	(505,000)	(236,000)	(254,000)
Proceeds from the issuance of senior notes			43,994,000
Payment of senior note issuance costs		(42,000)
Repayment of subordinate debt			(45,000,000)
Repayments of notes payable	(8,069,000)		(500,000)
Proceeds from exercise of stock options	33,000		11,000
Net cash (used in) provided by financing activities	(29,664,000)	103,881,000	102,813,000
Net change in cash and cash equivalents	(598,000)	8,499,000	6,996,000
Cash and cash equivalents at beginning of period	55,833,000	47,334,000	40,338,000
Cash and cash equivalents at end of period	55,235,000	55,833,000	47,334,000
Old Second Bancorp, Inc.
Cash Flows from Operating Activities
Net income	34,012,000	15,138,000	15,684,000
Adjustments to reconcile net income (loss) to net cash from operating activities:
Equity in undistributed net income of subsidiaries	(11,261,000)	(24,338,000)	(20,023,000)
Provision for deferred tax expense (benefit)	6,697,000	6,397,000	(1,039,000)
Net deferred tax expense due to DTA revaluation		3,908,000
Change in taxes payable	(1,211,000)	(4,797,000)	330,000
Change in other assets	97,000	74,000	171,000
Stock-based compensation	2,257,000	1,181,000	657,000
Other, net	172,000	(15,000)	282,000
Net cash provided by operating activities	30,763,000	(2,452,000)	(3,938,000)
Cash paid for acquisition, net of cash and cash equivalent retained	(47,074,000)
Net cash provided by (used in) investing activities	(47,074,000)
Cash Flows from Financing Activities
Net change in other short-term borrowings	4,000,000
Dividends paid common stock	(1,189,000)	(1,184,000)	(888,000)
Purchases of treasury stock	(505,000)	(236,000)	(254,000)
Proceeds from the issuance of senior notes			43,994,000
Payment of senior note issuance costs		(42,000)
Repayment of subordinate debt			(45,000,000)
Repayments of notes payable			(500,000)
Proceeds from exercise of stock options	33,000		11,000
Net cash (used in) provided by financing activities	2,339,000	(1,462,000)	(2,637,000)
Net change in cash and cash equivalents	(13,972,000)	(3,914,000)	(6,575,000)
Cash and cash equivalents at beginning of period	23,011,000	26,925,000	33,500,000
Cash and cash equivalents at end of period	$ 9,039,000	$ 23,011,000	$ 26,925,000

Employee Benefit Plans (Details

Employee Benefit Plans (Details) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Employee Benefit Plans
Company obligations under Voluntary Deferred Compensation Plan for Executives	$ 2,200,000	$ 1,600,000
Old Second Bancorp Inc Employees 401(k) Savings Plan and Trust
Employee Benefit Plans
Company's discretionary matching contributions to the Plan (as a percent)	100.00%	100.00%	100.00%
Company's discretionary matching contributions to the Plan (as a percent)	50.00%
Percentage of compensation contributed to the Plan matched by employer	3.00%	3.00%	3.00%
Participants vesting as percentage of discretionary matching contributions	100.00%	100.00%	100.00%
Expense relating to the 401(k) plan	$ 1,100,000	$ 785,000	$ 698,000